The Quantum Threat to Bitcoin: How Your Cryptocurrency Could Be Stolen in Under 10 Minutes

The first part of this series delved into the fundamental principles of quantum computing, revealing how it differs from classical computing. However, understanding the inner workings of a quantum computer is just the beginning. To grasp how it can be utilized to steal bitcoin, one must comprehend what it is targeting, the security mechanisms in place, and the specific vulnerabilities that can be exploited. This piece will examine bitcoin's encryption, the process of breaking it, and the significant impact of Google's recent quantum computing paper. Bitcoin's security relies on a system called elliptic curve cryptography, which involves a pair of keys: a private key and a public key. The public key is derived from the private key through a mathematical operation on a specific curve, creating a one-way map that allows for easy verification but makes it virtually impossible for classical computers to reverse-engineer. This one-way trapdoor is the foundation of bitcoin's security model, with the private key serving as proof of ownership and the public key being safe to share. However, the discovery of Shor's algorithm by mathematician Peter Shor in 1994 introduced a quantum algorithm capable of breaking this trapdoor. Shor's algorithm efficiently solves the discrete logarithm problem, which would take a classical computer an impractically long time to solve. The algorithm works by converting the problem into finding the period of a function, leveraging the properties of quantum computers to find this period and ultimately derive the private key. The recent paper by Google's Quantum AI division, in collaboration with Ethereum Foundation researcher Justin Drake and Stanford cryptographer Dan Boneh, has significantly reduced the estimated number of qubits required to run Shor's algorithm against bitcoin's elliptic curve, from millions to fewer than 500,000. This reduction, combined with the introduction of a practical attack scenario, changes the perspective on the quantum threat to bitcoin. The parts of Shor's algorithm that depend on the elliptic curve's fixed parameters can be precomputed, allowing the quantum computer to sit in a primed state, waiting for a target public key to appear. Once a public key is visible, the machine only needs to finish the second half of the calculation, which Google estimates takes around nine minutes. This creates a narrow window for a quantum attacker to derive a private key and submit a competing transaction, with a roughly 41% chance of succeeding before the original transaction confirms. The bigger concern is the 6.9 million bitcoin already exposed on the blockchain, which are vulnerable to an 'at-rest' attack that requires no time constraint. As the hardware gap closes, the potential risks to bitcoin's security become increasingly pressing, and understanding these threats is crucial for the future of cryptocurrency.