Could Google’s ‘Quantum Supremacy’ Break Cryptocurrency?

Google announced in October that “quantum supremacy’ has arrived, theoretically shifting the world in a new direction in which quantum computers are inching closer to overtaking traditional computers.

By achieving ‘quantum supremacy,’ researchers at the tech giant claim that they have managed to build a quantum computer with the ability to solve mathematical calculations that have so far been deemed impossible due to lack of a powerful computer. If the claims by the behemoth that has changed how people interact with the internet are anything to be believed, it will be a major stepping stone in the development of quantum computers and probably the beginning of the end of blockchain technology as we know it.

The death of blockchain technology will by extension spell the demise of cryptocurrencies due to the close and sometimes confusing relationship between the two.

Google’s quantum supremacy

Quantum supremacy means that only researchers have had the privilege to use a quantum computer to perform a calculation that even the supercomputers in existence cannot perform at all or requires an insane amount of time to do so.

In Google’s case, the calculation involved testing if an algorithm used for generating random was genuinely random. You may be wondering if this calculation is important at all. The calculation is not necessarily supposed to be useful or life-changing, it should only be able to prove a point that the age of quantum computing is on our doorsteps.

For Google, it was a gigantic leap forward as the researchers claim that the quantum computer managed to perform a highly complex calculation in 200 seconds. To put this into perspective, they say that it would take the world’s most powerful computer about 10,000 years to complete the same task.

Google believes that its achievement is a big milestone towards a future where quantum computers are a reality, the same way that modern-day computers were considered science fiction many years ago.

In the meantime, Google’s claims can be contested because making such a huge claim is only one side of the coin. The scientific community now has a duty, or rather, an obligation to test Google’s claims. IBM researchers have challenged Google’s claims by pointing out the same calculation Google says takes 10,000 years could be done in 2.5 days with improved technique and hardware on a classic system.

This, however, is a clear sign that the quantum community is making progress towards building computers that rely on the concepts of superposition and entanglement. If quantum computers become viable, they promise major leaps across several industries ranging from medicine, artificial intelligence, security, engineering, and communications to space travel. But this possibility also raises several questions on how technology will be used or abused in some cases.

On the flip side, the breakthrough with Google’s Sycamore quantum chip could also spell doom for bitcoin and cryptocurrencies.

Does quantum computing pose a threat to crypto?

The threat posed by quantum computing should not be dismissed without proper thought and attention it deserves. The power of a quantum computer is measured in quantum bits (qubits), which perform the same function as the binary output (“0” or “1”) for current computers.

The main advantage of qubits is the ability to carry out more operations at the same time. This is a cause for concern as encryption methods can be broken by this powerful type of computer.

Google’s breakthrough achievement is a 54-qubit computer, which at the moment, is still far away from posing a big threat to bitcoin. The leading digital currency, which Dr Wealth says was designed to be secure, employs the SHA-256 algorithm for mining and encrypts private and public keys using the Elliptical Curve Digital Signature Algorithm (ECDSA).

Some cryptographic experts believe that Shor’s algorithm – an integer factorization algorithm for a quantum computer that can be used to break cryptographic schemes – needs to run on a computer with 3,000 qubits.

Quantum computers with relatively high processing powers and scaling abilities will in the future be able to impact encryption techniques such as SHA-256. People will even have incentives to attack cryptocurrencies because they have value.

Will cryptocurrencies be broken by quantum computers?

Google’s quantum computing milestone should come as a warning and not as the end of cryptocurrencies. Qtum founder and CEO Patrick DAI pointed out that breaking the SHA-256 algorithm is not something that will happen overnight. There will be many warnings along the way, prompting the industry to switch to better cryptographic alternatives.

Ethereum co-creator Vitalik BUTERIN is not fazed by quantum computers because they are still far from being used “toward useful things.”

The crypto industry is making baby steps in protecting itself from the dangers of quantum computing. David CHAUM, the father of digital cash, is working on a quantum-resistant cryptocurrency while other experts will try to develop quantum-resistant updates to existing blockchains.

Quantum computers are not only a threat to cryptocurrencies but also the encryption that the internet is based upon. Governments and banks are also vulnerable to the same threat. This means that all these organizations, will in a way, work together (even without noticing it) to achieve a common goal of combating the threats posed by quantum computers.

It’s not the endgame yet

Any progress made in quantum computing is a double-edged sword that could bring as much harm as innovation to the world. In the right hands, quantum computers could be a game-changer in several facets of life but things could quickly turn ugly if they end up in the hands of criminals and hackers.

The death of cryptocurrencies at the hands of a quantum computer is a big exaggeration. The leaps in technology will be achieved in more or less equal proportion as new technology to mitigate the dangers of quantum computing. There is a long journey ahead. The introduction of quantum computers will likely be a big blow to miners who will be forced to upgrade their hardware.

In short, Google’s quantum supremacy will not obliterate cryptocurrencies but will force or hasten the need to develop new and stronger quantum-resistant cryptographic algorithms.

About the author:

Edward King is an investment analyst of a boutique PE fund based in London.

Image from The Wired