I don’t understand how they are supposed to do it, but I read that quantum computers will allegedly be very good and fast at breaking cryptographical codes.
And I read that the generation (“mining”) and security of cryptocurrencies depend on encryption algorithms. I hope I got this right. If this is so:
Would the assumption that a working quantum computer would render cryptocurrencies worthless be correct?
As an aside: would such a computer also be better than classical computers at generating bitcoins and other cryptocurrencies, even if they are worthless? By better I mean faster and using less energy for the same result.
I never actually liked the blockchain idea anyway. It strikes me as ‘security’ relying on a ridiculous amount of computation, and the expense thereof.
As a computer scientist, the blockchain idea just strikes me as inelegent anyway. Trying to acheive ‘security’ by throwing so much computer power at the issue that no one bad actor ‘should’ be able to circumvent it. Somehow one feels that there ought to be better algorithmic solutions.
Of course if quantum computation ever becomes a real technology, I think the blockchain idea may be dead?
I think this is the first understandable argument for quantum computing I have ever come across. Good, bring it on!
And yes, I agree with your assesment of blockchain technology too.
So … what would be the alternative, or is there one? Maybe we should go back to brick and mortar retail and pay with cash? It seems to be getting so bad that, as far as finances go, the Internet may become an unnavigable minefield?
The alternative to what? To the blockchain technology? Does it need an alternative? Is there any real use for it that cannot be done easier and faster any other way? I haven’t heard of one, but I am not an expert.
Well, that IS the discussion that is going on.
If we don’t want all our credentials hacked, I’d say yes.
AIUI the security of our credentials is based on cryptography, not the blockchain. The blockchain is for registering the steps the cryptocurrencies take after being created, a kind of registry. Who owned it when, to whom the user gave it in exchange for something. But that is not where the cryptography enters, it is a parallel road. You cannon “mine” cryptocurrency with the blockchain. Am I wrong?
I wouldn’t have the faintest idea, and that’s kind of scary. 
That is a very good question.
Supposedly the idea of some kind of non-centralized currency arose as a way to have a medium of exchange that no one authority controls.
But bitcoin and its imitators have so far become a speculative bubble: like the famous tulip mania in the 17th century.
What is any currency really based on? In the end it has to be real goods and materials, I think.
In that respect, the dollar has a secret weapon: the IRS. They can tax and take real items of useful value from individuals and businesses. Likewise Inland Revenue in the UK, etc etc…
I think that the cryptographical protections that protect the blockchain use the same concepts as other crypto protections, so my guess is yes, it would make them obsolete. But, it would also make internet security like SSL obsolete, and your bank cryptographical protections obsolete.
Useless crypto currencies (more useless?) is the least of our worries in that world.
Apparently Shor’s Algorithm (the quantum algorithm that threatens encryption) would be able to break the cryptography used by Bitcoin and other cryptocurrencies. There are probably ways to develop alternative cryptographies that would not yield to Shor’s though. There was a Computerphile video on this subject just recently:
You may well be right. That would upset a LOT of applecarts. We have sort of become accustomed to the idea that there are sufficiently strong encryption systems for communication. But this may not hold forever…
That is correct, but that is not the question I am asking.
Interesting. Some actors are preparing for the quantum revolution, just in case, as unlikely as it may turn out to be successful. But are Bitcoin et al preparing too?
I think any preparation would have to be a case of starting up a new, post-quantum cryptocurrency and abandoning the old one; I don’t know if it would even be possible to transition a blockchain to a completely different encryption method.
If it has to be replace/abandon, that means a lot of people will lose - you can’t sell up when everyone else is also trying to do the same and nobody is buying.
Even then, there would not necessarily be any guarantee that a new cryptographic method, immune to Shor’s, might not yield to some other attack that is yet to be devised, made possible by quantum computing.
There exist cryptographic algorithms that are (thought to be) resistant to attacks from quantum computing. Current versions of SSH use these, and give a warning when connecting to a host that does not use them. OpenSSL 4.0 was just released a few days ago, and it includes quantum safe algorithms. OpenSSL is one of the most important pieces of software in the world[1]. The pieces are in place for secure encryption in a post-quantum world.
That doesn’t directly matter to cryptocurrencies, though. Changing encryption algorithms used on some block chains may be easier or harder than on others. What is likely to happen is that a “hard fork” would be mandated, where everyone that uses that cryptocurrency will switch to a new block chain at a certain time. Things like that have happened in the past, so it is not unprecedented, but also not easy.
Yes, there are many other SSL/TLS implementations, but I don’t think any others are as widely used. ↩︎
I keep reading that quantum-based encryption (needing a quantum computer at both ends) are theoretically unbreakable and that it is not even possible to look at a message undetected. Schroedinger’s message.
I think you may be referring to quantum cryptography or quantum communication, which is quantum at both ends but doesn’t involve quantum computation. I’m not sure there is a quantum computer based encryption algorithm that is unbreakable (or exists).
In traditional quantum comm, you create unbreakable encryption the old fashioned way; by creating and sharing a one time pad. A message encrypted using a one time pad can not be broken, providing the one time pad is not available to anyone besides the sender and the receiver.
Quantum comm utilizes entangled photons as the bits of the one time pad to assure the sender that no one but the receiver has received the pad. I won’t go into the gory details, but by using two photons that are entangled, one kept by the sender (Bob) and one sent to the receiver (Alice), you can detect if someone (Eve) has “listened in” (through a simple blind measurement information exchange that does not provide information about the pad contents). You can then send your encrypted message in the open without fear of decryption by anyone but the receiver.
I call it “the old fashioned way” because it has been well known for many decades that encryption using a one time pad is unbreakable But anyone who has the pad can decrypt the message, so copying or intercepting the pad is the issue. Plus a one time pad is the same length as the message, which makes it inefficient.
Google announced last month that they plan to switch to post-quantum cryptographic algorithms by 2029. (This is about abandoning pre-quantum cryptography for things like certificate signing, encryption of communications, etc. and not really about cryptocurrency.)
There’s not even any guarantee that any given encryption method is secure against classical computers. Nobody’s ever found an efficient classical factoring algorithm, and nobody really thinks it’s likely to be possible, but it hasn’t been (and maybe can’t be) ruled out. Likewise for any of the other (apparently) hard problems used for encryption techniques.
[Moderating]
Oh, and I just noticed that this is in MPSIMS. Is there any reason why this shouldn’t be in FQ? It sure looks like a factual question to me.