Quantum Computing Vs. Blockchain: Impact on Cryptography
The major selling point of blockchain and its applications is that cryptographically secured distributed ledgers are virtually “unbreakable” under normal circumstances, given the current state of computational technology. Its validity, however, is heavily dependent on the “state of technology” assumption. Should a paradigmatic shift in computing occur, contemporary blockchain-based systems may become vulnerable to threats not accounted for in their design. But how urgent is the threat of this happening any time soon? Quantum Computing Vs. Blockchain: Impact on Cryptography (#GotBitcoin?)
The strides that physicists have been making for the last three decades toward building an operational quantum computer could soon contribute to such a shift. As the milestone called “quantum supremacy,” in which a quantum computer outperforms a traditional computer on a specific task, could be reached any day now, the question of whether prospective quantum-based devices are capable of “killing” blockchain comes into the spotlight.
A Primer On Quantum Computing
A quantum computer is any device that uses the principles of quantum mechanics to perform calculations. To store and manipulate information, regular computers use binary units called bits, which can represent one of two possible states: 0 or 1. Quantum machines rely on quantum bits (or qubits), which can be both a 0 and 1 at the same time. This phenomenon, called superposition, allows such devices to perform certain tasks much faster than their bit-based counterparts.
Another foundational term in quantum theory is entanglement. When two particles are entangled, they exist in the same quantum state, and change in the state if one prompts its peer to change accordingly, no matter how far apart the two are in physical space. Pairing qubits this way leads to the exponential growth in the quantum computer’s computational power.
The state of superposition, which is necessary to perform calculations, is difficult to achieve and enormously hard to maintain. Physicists use laser and microwave beams to put qubits in this working state and then employ an array of techniques to preserve it from the slightest temperature fluctuations, noises and electromagnetic waves. Current quantum computers are extremely error-prone due to the fragility of the working condition, which dissipates in a process called decoherence before most operations can be executed.
Quantum computational power is determined by how many qubits a machine can simultaneously leverage. Starting with a humble two qubits achieved in the first experiments in the late 1990s, the most powerful quantum computer today, operated by Google, can use up to 72 qubits.
Quantum Computers And Blockchain
Acknowledging all the conventional reservations, the idea of blockchains’ immutability and unmatched security is widely accepted: It underlies the public’s trust in digital assets and promotes mass adoption. However, the advent of quantum computing could potentially jeopardize the integrity of public-key cryptography, which is the backbone of blockchain security.
While the range of quantum computers’ potential applications is vast, the one most relevant in the context of blockchain technology and cryptography more generally is the capacity to run specific algorithms much faster than any existing supercomputer. One of the most widely discussed presumed use cases is running the famous Shor’s algorithm for factor decomposition, which could potentially render many contemporary encryption techniques obsolete.
As a group of researchers from the Russian Quantum Center observed in an article for the journal Nature, one potential risk stems from the fact that blockchain security heavily relies on one-way mathematical functions — the ones that are easy to run, yet much more difficult to calculate in reverse. Such functions are used to both generate digital signatures and validate transactions on the ledger.
A criminal equipped with a functional quantum device would be able to perform reverse calculations immensely faster, which would enable them to forge signatures, impersonate other users and gain access to their digital assets. In the context of mining, such a malicious actor could take over the process of updating the ledger, manipulate transaction history and double-spend coins.
The Russian researchers suggested that the architects of encrypted systems should start taking precautions against this threat immediately. One solution could be replacing conventional digital signatures with quantum-resistant cryptography — the kind of security algorithms specifically designed to withstand an attack from a sufficiently powerful quantum computer. Another remedy, the Russian physicists proposed, will only be available with the advent of a quantum internet, which is still several decades away. This prospective wireless communication architecture, based on the connection between remote entangled quantum particles, will unlock a wealth of new blockchain models and designs.
This is somewhat consonant with the mind-bending idea that Del Rajan and Matt Visser from the Victoria University in New Zealand expressed in a recent research paper. They proposed to forgo the use of quantum cryptography and leap straight to making blockchain a quantum-based system itself. Their model describes a blockchain based on qubits entangled not just in space, but also in time. The attempt to retrospectively alter the record of transactions, encoded by the history of a single particle’s states over time, would be impossible without destroying the particle altogether. The realization of this model, however, would be impossible until a quantum internet is up and running.
Practitioners Weigh In
While the futuristic solutions that academics propose may be decades away, a lot of hands-on research and development in quantum computing and quantum cryptography is happening right now. The experts working with quantum computing applications surveyed by Cointelegraph differed in their views on how immediate the quantum threat is. Yaniv Altshuler, an MIT researcher and CEO and co-founder of predictive analytics platform Endor Protocol, said:
“Quantum computers are becoming incredibly powerful, and they are advancing faster than most people expected. However, their capabilities will not break the blockchain. Each year, when new hardware is released, it rekindles concerns about the blockchain’s integrity, but there is no evidence that quantum computing can compromise the blockchain.”
Stewart Allen, the chief operating officer at quantum computing firm IonQ, believes that, by the time a quantum computer grows to become sufficiently powerful to imperil the integrity of today’s blockchains, security systems will have moved to algorithms capable of containing them:
“There is no real threat of quantum computers breaking blockchain cryptography in the short-term. If and when this does happen, cryptography will have moved to more quantum-proof algorithms. We’re at least a decade from quantum computers being able to break blockchain cryptography.”
Others, however, did not quite share this optimistic view.
ILCoin’s executive director, Norbert Goffa, expressed his concern over the potential emergence of quantum-powered mining pools:
“If somebody has a quantum based mining pool, it’s easy to dominate others.
[…]Today we do not have any quantum-based mining machines. On the other hand, a lot of companies have been working on quantum-based computing technology. We believe that in the next five years it could be real. Maybe less, who knows?”
Rakesh Ramachandran, CEO and co-founder of QBRICS Inc, emphasized that quantum computing is poised to have an effect in virtually every sphere in which cryptography is used. In the case of blockchain technology, he said, we might expect a systemic shift:
“Quantum computers will be redefining cryptography of not only blockchain but wherever there is an application of cryptography including simple things like an online banking website. There is a considerable research and work being done to mitigate the effects and move to quantum-resistant cryptography or post-quantum cryptography.
“However, the challenge of blockchain is not just about the threat that quantum computing represents but scope of how blockchain will migrate to the new version of cryptography.”
All experts provided surprisingly similar estimates of how much time we have before quantum computers can pose a threat to blockchains’ integrity, varying within a range from five to 10 years. They were also fairly consistent in their recipes for dealing with potential quantum-powered attacks: Most agree that a gradual shift to quantum-resistant cryptography will be necessary, as well as building infrastructure that will support it. Blockchains will have to evolve, but it is unlikely that quantum computing technology will fundamentally threaten their existence.
Quantum Computing Holds Promise for Banks, Executives Say
‘You could argue that finance has got the shortest path to impact,’ says Goldman’s head of research-and-development engineering.
When quantum computing hits the market, the financial-services industry could be the first to benefit, a Goldman Sachs Group Inc. executive said at a quantum-computing panel event.
“In the universe of industries where there is a potential quantum advantage, you could argue that finance has got the shortest path to impact,” said Jeremy Glick, head of research-and-development engineering at Goldman Sachs.
That’s because a quantum algorithm could be deployed to a new financial model in days or weeks, while approving a new material or drug discovered by a quantum computer is likely to take years, he said at Thursday’s event, hosted by International Business Machines Corp.
But there’s a catch. Two, actually. First, no one is sure exactly how quantum computing could transform finance. “I think the big win is finding something entirely new, and we haven’t found that yet,” Mr. Glick said.
The second catch concerns quantum computing itself. Quantum computers promise to be extremely powerful—but no commercial-grade quantum machine has been built yet, although IBM and other companies are developing the hardware necessary to combat technical challenges.
With ideas at a premium and the hardware still to come, one thing the finance industry can do is to gain the skills necessary to be “quantum-conversant,” Mr. Glick said, meaning professionals need to be well-versed in quantum computing and how the technology can be applied to finance and other industries.
College students could, for example, study quantum computing as a minor and then work with banks and regulators on applications, he said.
JPMorgan Chase & Co. is working to cultivate quantum-computing skills for some employees, Nikitas Stamatopoulos, the bank’s vice president of quantitative research, said at the event.
Since late 2017, JPMorgan has been collaborating with researchers at IBM to experiment with quantum computing. A working group from the bank has been running tests via the cloud on IBM’s early-stage quantum-computing machine, suitable for small-scale experiments.
The team has found that quantum computing could be used to speed up computationally intensive option-pricing and risk-assessment calculations.
But it’s still in the early stages of discovering what’s possible, because a commercial-grade quantum computer hasn’t been built. “If we had one today, what would we do? The answer today is not very clear,” Mr. Stamatopoulos said.
Experts Split on Practical Implications of Quantum Cryptography
Scientists in China managed to exchange a crypto key at a distance of over 1,000 kilometers, could this lead to hackerproof cryptography?
Scientists in China were able to exchange an encryption key at a distance of 1,120 kilometers, this exceeds the previous best attempt by 1,000 kilometers. Crypto experts discuss whether this could have practical implications for the industry.
Quantum computers are scarecrows for the crypto industry for years, with some speculating that the advances in this technology will make all existing cryptography obsolete.
This time quantum entanglement was used to exchange a secret key that could be used to encrypt and decrypt messages. One could imagine if this technology becomes a commodity it could make crypto hacking obsolete as users would be able to authorize transactions outside of the Internet.
We reached out to crypto experts to learn whether this technology could have practical implications for the industry in the near future.
Not In Our Lifetime
Cornell University professor and Ava co-founder Emin Gün Sirer told Cointelegraph that he has been hoping for this technology for the past 40 years. He believes it will become practical sooner or later. “Yes, I keep hoping! I first read about this in the 1980s.
At some point, it’ll be practical,” he said.
But Bitcoin Core developer Wladimir van der Laan does not believe it will be adopted in his lifetime:
“Realistically, I expect it to be a long while before quantum computers are available commonly enough to be applicable for a decentralized network, if ever (like: not in my lifetime)”.
Ian Grigg, the inventor of the Ricardian Contract and a notable a cypherpunk does not believe quantum cryptography has something practical to offer:
“Nope. We don’t need quantum cryptography to securely distribute keys. We can do it cheaper with software methods.”
Sergio Demian Lerner, a Bitcoin (BTC) researcher and designer of RSK agrees with Grigg that there are less expensive ways to get the job done:
“There is no need for a quantum link to exchange keys. You just travel once, and exchange keys. And then you use those keys for the next 10 years. In my humble opinion, it has absolutely no application that can cover the infrastructure cost.”
While we await the advances in the quantum realm, a new interesting pattern in the way Satoshi Nakamoto was mining has been noted by Lerner.
Post-Quantum’s Algorithm Is Finalist In NIST’s Post-Quantum Cryptography Competition
UK deep tech start-up Post-Quantum is the only remaining candidate in the ‘code-based’ category
Rapid advances mean a sufficiently developed quantum computer will soon break today’s public-key cryptography, placing virtually all the world’s data at risk. Combined with the threat of nation states such as China and Russia harvesting data today, for decryption in the future, the need to move the world to modern ‘quantum-safe’ public key cryptography has never been more urgent.
That’s why the National Institute for Science and Technology’s (NIST) global competition to identify the strongest cryptographic algorithms that can withstand attack by quantum computers has been running for four years already, with the objective of creating a new global standard by 2022.
Today, UK deep tech start-up Post-Quantum announces it has merged its own NIST submission, known as ‘NTS-KEM’, with the submission led by Professor Daniel Bernstein. The joint candidate, known as ‘Classic McEliece’, has been selected as one of seven ‘finalists’ in NIST’s third round selection process for public-key cryptography and key establishment. Selection follows a gruelling multi-year period where the world’s preeminent cryptographers and hackers have been attempting to crack the algorithm, without success.
NIST’s post-quantum standard is necessary because it has been shown that quantum computers can easily factorise large numbers and it is now a matter of time before today’s public-key cryptography standards (RSA and Elliptic Curve) are broken. These standards currently protect virtually all the world’s data both at rest and in transit across the internet, as well as crypto-currencies such as Bitcoin.
All technical products (browsers, applications, email and communication protocols) will need to transition to NIST’s new post-quantum encryption standard as it becomes available from 2022. Post-Quantum is launching its own range of quantum-safe products having recently unveiled its biometric identity authentication service ‘Nomidio’.
Importantly, Classic McEliece is the only finalist within the ‘code-based’ category of the competition, which is significant given NIST intends for the final standard to include a range of cryptographic techniques, widely expected to include code-based. Classic McEliece is ultra-secure whilst offering enhanced performance that even outperforms today’s standards.
Andersen Cheng, CEO and Co-Founder at Post-Quantum commented: “We are pleased to have combined our cryptographic innovations with those of Professor Daniel Bernstein’s team to create a single NIST submission. Dan is one of the top cryptographers in the world and together with Professor Kenny Paterson from ETH Zurich, Professors Martin Albrecht and Carlos Cid from Royal Holloway University of London, we are confident our joint efforts will ensure Classic McEliece remains a tour de force for many years to come.
He Continued: “The entire world needs to upgrade its encryption and we last did that in 1978, when RSA came in. The stakes couldn’t be higher with record levels of cyber-attack and heightened nation state activity – if China or Russia is the first to crack RSA then cyber Armageddon will begin.”
“This isn’t an academic exercise for us, we are already several years down the commercialisation path with real-world quantum-safe products for identity authentication and VPN. If you work for an organisation with intellectual property or critical data with a long shelf life, and you’re working from home during lockdown, you should already be using a quantum-safe VPN.” Added Cheng.
Post-Quantum’s Classic McEliece algorithm deliberately introduces errors into the encryption process and the outputs are ‘never the same’, which in effect means quantum computers have ‘nowhere to start’ when trying to brute-force break the encryption.
This work was pioneered by Post-Quantum Co-Founder Professor Martin Tomlinson of Plymouth University whose background in correcting errors in satellite communications (e.g. removing pixilation from satellite TV) has been transferred into the field of cryptography. Also essential to Post-Quantum’s algorithm is third Co-Founder and CTO, CJ Tjhai, a former student of Professor Tomlinson and a specialist in optimising and creating commercially robust software for real world implementations.
“We have already launched our quantum-ready identity solutions under the ‘Nomidio’ brand for partners and clients such as Amazon, Avaya and Hitachi. We are also bringing to market a quantum-safe Virtual Private Network (VPN) that companies can buy off-the-shelf to ensure their data crossing the internet is protected from quantum attack. The great risk is that adversaries may steal data today and then, in years to come, use a quantum machine to decrypt it.” Added Tjhai. “Whichever way NIST formalises the eventual standard, our products are engineered for ‘crypto agility’, so we can simply drop the NIST finalist algorithms in.”
NIST’s Post-Quantum Cryptography competition has already been running for almost four years and the original 82 submissions, including multiple submissions from Microsoft, IBM and Intel, have now been whittled down to the seven ‘finalists’, deemed to be widely applicable algorithms that will be ‘ready to go’ after the final selection round. Eight ‘alternate’ algorithms are also still being assessed that may need more time to mature or are tailored for more specific applications.
After this final round concludes NIST expects to standardise one or two algorithms for Encryption and Key Establishment, and another for Digital Signatures.
* Public-key Encryption: an encryption scheme based on widely distributed public-keys and private keys known only to the owner. In such a system, any person can encrypt a message using the receiver’s public key, but that encrypted message can only be decrypted with the receiver’s private key.
* Key Establishment: the process of securely providing encryption keys to two parties that wish to encrypt and decrypt messages exchanged between one another.
* Digital Signatures: a technique for verifying the authenticity of digital messages helping a receiver to be sure the message originated from a specific sender.
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