Blockchain, Cryptocurrency, NFTs, and Decentralization Finance It has become a common terminology, as blockchain is now being hailed as a very secure and much faster way to record transactions due to the computational intensity of trying to crack it. Both companies and individuals have poured countless amounts of capital into technology by buying cryptocurrencies or by developing their own. Currency or asset chains.
But in the dynamic internet environment, is this $2.7 trillion market safe and secure against the future?
The short answer is no.
With every innovation in quantum computing, the threat to the blockchain increases.
There are two main problems facing the technology, the first being its reliance on a form of encryption known as public key cryptography; And second, its dependence on a type of algorithm called a hash function.
Public key cryptography is an encryption method that publishes a key for the world to use so that they can encrypt information that only the owner of the private key can see.
The hash is generated by running a widely known and well-established algorithm on a piece of information to create an almost unique numerical representation of it. It is computationally impossible to construct the original information from the hashed representation, and it is said to be resistant to finding another piece of data with the exact same numerical representation. In both Proof of Work and Proof of Stake blockchains, digitally signed hashes along with random numbers are used to sign the block.
So what’s the problem?
The threat from quantum computing to public key cryptography is a known issue and has been discussed at length by many experienced professionals. It is an issue recognized by governments and commercial entities. NIST, the US National Institute of Standards and Technology, is currently working on defining the next stage of cryptography (also known as post-quantum cryptography). Many experts will highlight that the types of quantum computers capable of hacking this are still a long way off, which is true, but many competing technologies along with quantum computing put this ahead of the cybersecurity threat vector.
Therefore, one can see that the main near-term problem facing the chain comes from the threat to the hashing algorithm from quantum computing or quantum accelerator devices. There are some issues with the hash method, however, the main problem facing these chains is that a quantum computer will be able to solve these hashs at a much faster rate than any computation-based approach, thus taking ownership of the network. Significant progress has been made in the past couple of years on a type of quantum algorithm called Grover’s algorithm, which poses the greatest danger to the network because a well-debugged quantum computer is not needed.
David Worrall, co-founder of Secqai. “Now is the time to implement the solutions available to prepare us for the future.”
This risk is further increased by the decentralized nature of the blockchain, where the latest electronic technologies are not designed to easily integrate with, for example, new hardware-based cryptography such as secure entropy sources or quantum random number generators.
In fact, research has shown that deploying secure post-quantum algorithms into existing blockchain structures is not possible without huge increases in transaction costs that sometimes outweigh the value of the transaction.
On the contrary, the traditional banking infrastructure is relatively easy to modernize as the back-end software and hardware are centrally managed by each bank and each integrated party, i.e. the list of parties that have to be secure is well known.
Blockchain developers understand the challenge today, and as demonstrated by the need to start working on setting up their systems by integrating post-quantum methods into their infrastructure and adopting best-practice technologies to ensure they are prepared for the quantum world.
Rahul Tyagi He is a former management consultant, inventor and co-founder of cybersecurity startup Secqai