The emergence of quantum computing has sparked concerns about the potential vulnerability of legacy blockchains. However, experts suggest that XRP's architecture may provide better protection against quantum threats than Bitcoin's. XRP operates on the XRP Ledger, an open-source, decentralized blockchain that facilitates cross-border transactions through Ripple, a fintech firm.
Let's examine this in more detail. The primary threat to blockchains comes from the possibility that a sufficiently powerful quantum computer could use Shor's algorithm to reverse-engineer private keys from exposed public keys, thereby draining funds. Typically, public keys are exposed when sending transactions, and account activity, rather than balance or duration of holding an address, makes users quantum-vulnerable.
A recent audit of the XRP Ledger found that around 300,000 accounts holding 2.4 billion XRP have never sent funds and thus have never exposed their public keys, making them quantum-safe by default. However, dormant whale accounts that have transacted in the past and exposed their public keys are at risk. The audit identified two such accounts holding 21 million XRP, which is only 0.03% of the circulating supply. The XRP Ledger's account-based system and signing key rotation feature allow users to swap their signing key without moving funds, enhancing security.
Additionally, the escrow feature with a time lock provides further protection, as funds locked in escrow are safe due to logic rather than cryptography. In contrast, Bitcoin's blockchain appears more vulnerable to quantum threats due to its larger scale and lack of key rotation feature.
Approximately 6.9 million BTC, or nearly 35% of Bitcoin's circulating supply, are vulnerable, including Satoshi Nakamoto's 1 million BTC, which has never moved. Bitcoin holders face a structural problem in protecting their funds, as they must move them to a new address, temporarily exposing the public key.
While this risk is still theoretical, it highlights the relative vulnerability of Bitcoin holders. Nevertheless, Bitcoin developers have initiated proposals to develop quantum resistance.