Quantum computers, which leverage the principles of quantum mechanics for unprecedented computational power, are getting closer to posing a real threat to Bitcoin's security, according to experts.
That threat became even more apparent last week when Google unveiled its latest quantum processing chip, Willow, which offers a 56% performance boost over its predecessor. If developments continue at this pace, researchers predict that quantum computers could compromise Bitcoin’s encryption within the next five years.
“We are about five years away from commercial quantum computers being able to crack the elliptic curve keys that secure Bitcoin wallets,” said Pierre-Luc Dallaire-Demers, a quantum physicist and visiting scientist at the University of Calgary.
Bitcoin relies on two key encryption methods: ECDSA-256 and SHA-256. ECDSA-256 encryption secures Bitcoin wallets and signs transactions using public-private key pairs. However, this encryption is vulnerable to Shor’s algorithm, a quantum algorithm that can quickly factor large numbers, which could reveal the private keys behind Bitcoin wallets.
“Breaking these keys is one of the easiest applications for large quantum computers,” Dallaire-Demers said.
In comparison, SHA-256, the encryption used in Bitcoin’s proof-of-work mining process, is less at risk. According to digital asset firm Galaxy, the hash length can be doubled to secure it against quantum attacks.
But defending Bitcoin’s ECDSA encryption would require fundamental changes to its cryptographic infrastructure, which is no easy feat for the $3.8 trillion cryptocurrency industry.
The most vulnerable wallets are old Pay-To-Public-Key (P2PK) addresses created before 2012, which expose public keys to direct quantum attacks. The funds in these wallets, which are estimated to contain 1.1 million Bitcoins worth over $113 billion and belong to the mysterious founder of Bitcoin, Satoshi Nakamoto, could be among the first to go missing if quantum computing advances.
*This is not investment advice.