Bitcoin and cryptocurrencies are surging as of late – so much so that the $2 trillion valuation barrier has once again been breached. Not long ago, bitcoin rose back up over the $50,000 mark, and it looks like things are continuing in this bullish train, though BTC has fallen back a bit by about $2,000 at the time of writing.
Bitcoin Could Find a New Enemy in Quantum
Many technologists are now claiming that the bitcoin software needs to be updated. They warn that if this is not handled in due time, advances in quantum computing could lead to the encryption that bitcoin is so well known for becoming obsolete or undermined in some way.
David Williams – the founder of quantum encryption company Arqit – explained in a statement:
Quantum computers, expected to be operational by around 2026, will easily undermine any blockchain security systems because of their power. There needs to be rather more urgency.
Quantum computing isn’t anything new. In fact, the process has been around for roughly 30 years at this point. Right now, developers with Google are establishing their own quantum computer that many analysts have warned could ultimately hurt the bitcoin process in the future.
But it’s not this computer that’s the primary problem. Williams points out certain issues discussed by Charles Hoskinson in the past. Hoskinson is the co-creator of Ethereum, the second largest cryptocurrency in the world and the number one competitor to bitcoin. He has stated that post-quantum algorithms are set to slow blockchain down significantly in the future and says that quantum encryption keys need to be fixed and updated if they’re going to play any viable role.
Hoskinson has said:
Blockchains are effectively fundamentally flawed if they don’t address the oncoming quantum age. The grownups in the room know what’s coming.
Duncan Jones – the head of quantum cybersecurity at Cambridge Quantum Computing – also threw his two cents in, claiming:
If this isn’t addressed before quantum computers pose a threat, the impact would be massive. Attackers could create fraudulent transactions and steal currency, as well as potentially disrupting blockchain operations… Time is of the essence, here. It’s important for decentralized networks to start this migration process soon because it requires careful planning and execution. However, I’m hopeful the core developers behind these platforms understand the issues and will be addressing them.
Is a New Recession On the Way?
Williams has also said that China is pulling ahead in the global quantum space. He says that this could ultimately do significant damage to the crypto arena and lead to a financial crisis similar with the one experienced in 2008 and 2009. He says:
On day one, the creation of a quantum computer doesn’t break everything. It will probably initially happen in secret and the information will slowly leak out that the cryptography has been broken. Then there will be a complete loss of confidence, similar with how the global financial crisis saw confidence in the system disintegrate.