As Donald Trump prepares to take office, he's leaning into his self-proclaimed title of "crypto president," launching his own official meme coin and working on a potential federal reserve of bitcoin.
Crypto holdings are widely regarded as ultra-secure due to the blockchain they are traded on. The high value of cryptocurrencies like bitcoin, worth over $100,000 each at the time of publication, could serve as a hedge against inflation or pay down the national debt.
Recent advancements in quantum computing could undermine that security — and a whole lot more — two researchers on the advanced technology explained to Business Insider.
"What we're talking about is the possibility of a hack, not just into individual cryptocurrencies, but our larger financial markets," Arthur Herman, director of the Quantum Alliance Initiative at Hudson Institute, said.
Quantum computing is a rapidly evolving technology that combines the disciplines of computer science, mathematics, and quantum mechanics to solve more complex problems more quickly than is possible through classical computing.
Where classical computing uses binary digits — 0s and 1s, called bits — to represent information, quantum computing relies on the quantum equivalent of bits, called qubits, which are represented by a superposition of multiple states, such as 0, 1, or a combination of both.
Qubits themselves are unstable, and it's difficult to predict their behavior. They behave differently when observed, making measuring their state challenging, and require specific conditions such as low light or extremely cold environments to replicate results reliably and without errors. The errors become especially pronounced, and the qubits behavior less reliable, when scaling the computing power up using additional qubits — making advancement in the field slowgoing.
A qubit's capacity to exist in multiple states at once, like a spinning coin appearing to show both heads and tails simultaneously, allows quantum computers to quickly calculate equations with multiple solutions and perform advanced computations that would be impossible for classical computers.
Researchers in the field agree that the previously unsolvable computations could help discover new drugs, develop new chemical compounds, break our current encryption methods, and reverse the pseudonymity of the blockchain.
Supercomputers: 10 septillion years behind
Last month, Google unveiled Willow, its new quantum chip, which represents a major advancement in commercial quantum computing. The company says Willow can perform a standard benchmark computation, an industry-accepted calculation used to measure the performance of quantum computers, in under five minutes — a task that would take the current fastest supercomputers 10 septillion years to complete. That's 10 followed by 24 zeroes, a timeframe that exceeds the age of the universe.
Willow also solves a challenge related to correcting errors in the qubits' behavior while scaling the computing power up, which has plagued the industry for 30 years. Other private companies, like IBM and Microsoft, allies like France, and adversaries including Russia and China, are also working to develop the tech.
Karl Holmqvist has served as a quantum security advisor to major government bodies, including the Department of Defense and NATO. He is the CEO of Lastwall, which provides cybersecurity solutions designed to protect users from quantum computing threats. Holmqvist said that while the timeframe for creating a large, fully functional quantum computer — compared to the midsize versions with still unreliable qubit behavior we have now — remains unclear, the things such a device will be able to do when the technology becomes more stable are starting to come into focus.
"A really concerning thing is that, right now, when we store personal information, we encrypt that data, and we often encrypt it with systems that use public key cryptography — and that's what quantum computers may come to actually break," Holmqvist said. "So we have to think of all the databases and all the systems that have records of what we do, and there is a problem for privacy."
It's not just basic data privacy or the risk of personal financial details becoming public. Encrypted data, from national security secrets to the blockchain and beyond, will be readily accessible and, more worryingly, manipulatable by anyone with a quantum-capable system.
"When you start peeling back the layers, it's like anything that's internet-connected will likely have problems," Holmqvist said. "A lot of the time, we trust that the links between systems are secure and the data that's gone between them is secure, and there's no way to get into those that they're encrypted. If you take away that default assumption, it allows so many new entry points into systems that it becomes quite concerning."
Herman, the director of the Quantum Alliance Initiative, told BI that a hack from a quantum computer would be "totally stealth" due to a quantum machine's potential ability to lay bare encryption and operate inside computer systems without leaving a trace, meaning a bad actor could cause "catastrophic" damage without being detected.
"It's not a situation like with a conventional hacker, where he breaks into one system, into one bank or one cryptocurrency exchange, and then when he's finished with one, has to move on to the next," Herman said. "Once you've cracked one system, you've cracked them all, and you can help yourself, almost instantaneously, to whatever assets or moneys you want."
Herman said the race to achieve reliable quantum computing mirrors the nuclear arms race, but officials aren't taking the risk nearly as seriously as he thinks they should.
"From the point of view of where we stand in our competition with Russia and particularly China, the race to a quantum computer should be one of the major factors and threats that we want to be able to deter," Herman said. "But it's also a challenge that we want to come out on top of and be the first ones with a quantum computer because, ultimately, that'll be the real deterrence to this kind of threat: If you try to do it to us, then we can do it with even more devastating effect on you."
