The rise of quantum computing has sparked concerns about the potential risks it poses to legacy blockchains. Experts suggest that XRP's architecture may be better equipped to handle these threats than Bitcoin's.
XRP operates on the XRP Ledger, a decentralized, open-source blockchain, and is used by fintech firm Ripple for cross-border transactions. Let's delve into the details.
The primary threat to blockchains is the potential for a sufficiently powerful quantum computer to reverse-engineer private keys from exposed public keys, thereby draining funds. Typically, public keys are exposed when sending transactions, and only wallet addresses are visible on-chain when receiving funds.
This means that account activity, rather than balance or duration of holding, is what makes users vulnerable to quantum attacks. Recently, a quantum vulnerability audit of the XRP Ledger found that around 300,000 accounts holding 2.4 billion XRP have never sent funds and are therefore quantum-safe by default. However, dormant whale accounts that have transacted in the past and exposed their public keys are at risk.
The audit found two such accounts holding 21 million XRP, which is only 0.03% of the circulating supply. The XRP Ledger's account-based system and key rotation feature allow users to swap signing keys without moving funds, reducing the risk of quantum attacks. Additionally, the escrow feature with time locks provides an extra layer of protection.
In contrast, Bitcoin's blockchain is more vulnerable to quantum threats due to its larger scale and lack of key rotation feature. Approximately 6.9 million BTC, or 35% of the circulating supply, are vulnerable to quantum attacks, including Satoshi Nakamoto's 1 million BTC. Bitcoin holders face a structural problem, as they must move funds to a new address to protect against quantum attacks, but this process exposes the public key of the old address.
While the risk is still theoretical, it highlights the relative vulnerability of Bitcoin holders. Bitcoin developers have already proposed several solutions to develop quantum resistance.