Is Quantum Computing a Threat to Bitcoin Network? | BitPinas

Is Quantum Computing a Threat to Bitcoin Network? | BitPinas

Time Stamp: August 21, 2023 12:03 AM
Is Quantum Computing a Threat to Bitcoin Network? | BitPinas PlatoBlockchain Data Intelligence. Vertical Search. Ai.
Share some Bitpinas love:
  • Quantum computing has the potential to impact cryptocurrency, with experts discussing its threat to the Bitcoin Network.
  • For Ramon Tayag, quantum computing is more of a threat to the banking system than Bitcoin. 
  • While for Atty. Rafael Padilla, it will be a security threat to Bitcoin, but in the same manner that it will be a threat to all existing encryption technologies.

Considering the rapid technological advancements and innovations, the new system called quantum computing may have potential implications for cryptocurrency. 

During the recent BitPinas Webcast, crypto experts and Bitcoin OGs Ramon Tayag and Atty. Rafael Padilla expressed their opinions on quantum computing and its possible effects on Bitcoin.

Expert Opinions: Will Quantum Computing Threaten Bitcoin? 

“The short answer is, I’m not worried about it,” Tayag stated, while noting that constant research on the subject is required.

According to him, it will take time to acquire the power needed, called qubits, to operate a quantum computer and pose a threat to the crypto industry. Moreover, he stated that there are already some discussions about moving to more quantum-resistant cryptography. 

“I often hear what it really is, and I think, quantum computing is more of a threat to the banking system than Bitcoin,” he added.

While for Padilla, quantum computing will be a security threat to Bitcoin, “but in the same manner that it will be a threat to all existing encryption technologies.”

“Therefore, lahat (everything) will be affected. Nevertheless, there are already some designs that are being introduced to make the encryption resistant,” he stated.

Padilla also stressed that due to Bitcoin’s decentralized nature, the community can implement proposals to incorporate quantum-resistant technologies to protect the Bitcoin Network if they deem it necessary and urgent.

Introduction to Quantum Computing 

Quantum computing is a rapidly developing technology that uses the principles of quantum mechanics—a physics branch explaining matter and energy behavior at tiny scales like atoms—to solve problems that are too difficult and complex for traditional computers. 

Classical computers use bits, which can only be in one of two states: 0 or 1. Quantum computers, on the other hand, use qubits, which can be in multiple states at the same time. This allows quantum computers to perform calculations that are much faster than classical computers.

Quantum computing relies on the following key principles: superposition, in which qubits can represent both 0 and 1 at the same time, enabling multiple calculations to be performed simultaneously; entanglement, in which qubits are linked so that the state of one affects the other, leading to faster problem-solving; and quantum gates, which, like computer buttons, manipulate qubits’ special states to solve complex problems effectively. 

According to sources, quantum computing is still in its early stages of development, but it has made some significant breakthroughs in recent years, such as achieving quantum supremacy, developing cloud-based quantum services, and exploring various use cases for different industries.

The Present State of Bitcoin’s Cryptography

Bitcoin employs cryptography to secure its transactions. Cryptography is a system of securing data by hastening information which only allows authorized people to view. This makes it very difficult for someone to create counterfeit cryptocurrencies.

Bitcoin relies on four primary cryptographic techniques:

  • Hash functions: Mathematical tools that convert data inputs into fixed-length outputs. These serve various purposes, including generating digital fingerprints for data, ensuring block and transaction integrity, and generating fresh addresses.
  • Public-key cryptography: Utilizing key pairs for encryption and decryption, enabling the creation of digital signatures to validate transaction ownership and authenticity.
  • Symmetric-key cryptography: Employing a single key for both encryption and decryption, securing communication between nodes and wallets.
  • Proof-of-work: A mechanism that requires miners to perform a certain amount of computational work to create new blocks and secure the network56.

In 2022, the 19 millionth Bitcoin was mined by SBI Crypto, leaving only two million to mine out of the total 21 million.

Currently, it is already at its third halving since the first Bitcoin was mined. The reward per block was initially 50 BTC, but it has been halved twice since then, and is now 6.25 BTC per block. This will continue until around block 840,000, when the reward will be halved again to 3.125 BTC per block. The next halving, which will reduce the issuance rate by half, is scheduled for 2024.

Read BitPinas’ Bitcoin Series:

Potential Vulnerabilities of BTC to Quantum Attacks 

Some experts believe that quantum computers may be powerful enough to break Bitcoin’s cryptography by the 2030s. They estimate that a quantum computer with 13 million qubits could break Bitcoin’s protective encryption within a day.

In a separate study, researchers investigated the security of Bitcoin against quantum computer attacks. They found that Bitcoin’s primary operating method, known as proof-of-work, may be secure from quantum computers for around 10 years. However, the special code that protects Bitcoin transactions could be cracked by a quantum computer as early as 2027.

“In summary, Bitcoin will be very vulnerable to quantum attacks using Shor’s algorithm. The most wide-spread vulnerability open to attack will be transactions that have been declared to the network and not yet added to a block,” researchers Joseph J. Kearney and Carlos A. Perez-Delgado wrote in their paper.

They also believe that Bitcoin could be vulnerable to attacks from quantum computers, and that the danger is greater for transactions waiting to be confirmed and older Bitcoin accounts. Basically, ‌leading crypto may face some issues with quantum computers in the future, and some parts may be at risk sooner than others.

This article is published on BitPinas: Is Quantum Computing a Threat to Bitcoin Network?

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.

Share some Bitpinas love:

Time Stamp:

More from Bitpinas