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

The first part of this series introduced the principles of quantum computing, but the question remains: how can this technology be used to steal bitcoin? To understand the answer, it's essential to grasp how bitcoin's security works and where its weaknesses lie. Bitcoin relies on a system called elliptic curve cryptography, which uses a pair of keys: a private key and a public key. The public key is derived from the private key through a mathematical operation, creating a one-way map that makes it virtually impossible for classical computers to reverse the process. However, a quantum algorithm known as Shor's algorithm can break this encryption. Recently, Google's Quantum AI division, in collaboration with other researchers, has made significant progress in reducing the number of qubits required to run Shor's algorithm, from millions to fewer than 500,000. This breakthrough has significant implications for the security of bitcoin, particularly for the 6.9 million coins that have already had their public keys exposed on the blockchain. With the advent of more powerful quantum computers, these coins are vulnerable to an 'at-rest' attack, which can be launched at any time. For newer coins, the public key is hidden until a transaction is made, at which point the attacker has approximately nine minutes to derive the private key and submit a competing transaction. This mempool attack, although alarming, requires a quantum computer that does not yet exist. Nevertheless, the threat is real, and the gap between the required hardware and current technology is rapidly closing.