The Quantum Threat to Bitcoin: How a Powerful Computer Can Steal Your Cryptocurrency in Under 10 Minutes

The first part of this series delved into the principles of quantum computing, but understanding how it works is only half the story. To comprehend the threat it poses to bitcoin, we need to examine the target: the encryption that secures the cryptocurrency. Bitcoin relies on elliptic curve cryptography, a system that utilizes a pair of keys - a private key and a public key. The private key is a secret number, while the public key is derived from it through a mathematical operation on a specific curve. This process is a one-way function, meaning it's easy to generate the public key from the private key, but virtually impossible to do the reverse. However, a quantum algorithm known as Shor's algorithm can break this encryption. Developed by mathematician Peter Shor in 1994, the algorithm solves the discrete logarithm problem efficiently, which is the foundation of bitcoin's security. The recent paper by Google's Quantum AI division has reduced the estimated number of qubits required to run Shor's algorithm, making the threat more tangible. The team designed two quantum circuits that can implement the algorithm against bitcoin's specific elliptic curve, using fewer than 500,000 qubits. This reduction in required qubits brings the possibility of a quantum attack closer to reality. The attack scenario introduced by Google's paper changes the perspective on the threat. By precomputing parts of the algorithm that depend on the elliptic curve's fixed parameters, a quantum computer can be primed to attack a target public key as soon as it appears. The moment a user broadcasts a transaction, the machine only needs to finish the second half of the calculation, which Google estimates takes around nine minutes. This creates a narrow window of opportunity for the attacker to derive the private key and submit a competing transaction. The math gives the attacker a roughly 41% chance of succeeding before the original transaction confirms. Furthermore, approximately 6.9 million bitcoin are already vulnerable to an 'at-rest' attack, as their public keys have been permanently exposed on the blockchain. A quantum computer running Shor's algorithm can turn these public keys into private keys, giving the attacker control over the coins. The implications of this vulnerability and the developments in quantum computing will be explored in the next piece of this series.