We are witnessing an economic revolution. Not quite as grandiose or desctructive as the final scene of Fight Club when Project Mayhem detonates bombs to take the entire financial system down. But still much more drastic than what the financial system has dealt with in decades.
Bitcoin and other crypto-currencies crashed the fiat money party uninvited and created a commotion. Crypto-currencies are not backed by any government or institution. Therefore no government can print crypto-currency nor can they stop it from being printed. Governments can not control crypto-currency transactions, flows, or prices of crypto-currencies against their national currencies.
Bitcoin price has skyrocketed within last couple of years and it has been thought of as a practical wealth repository, a digital gold.
Some other crypto-currencies with fast transaction potential are rivaling actual fiat money for daily use. Crypto-currencies have also seen wide adoption at countries where the government is perceived to be corrupt and therefore national currency is not trusted as there risk of de-valuation, seizure by government from bank accounts, etc.
The enthusiastical uptake of crypto-currencies can be attributed to trust in the underlying blockchain technology. They are ‘mined’ by computers and programmatically ensured to be limited in supply to preserve value: no central authority exists that can ‘print money’. They are also protected from double spending and counterfeits again ensured by technology. The basic technology that protects this production and spending mechanisms of crypto-currencies rests on strong encryption. This is the roughly the same encryption model that had been invented a long time ago and also protects the internet e-commerce. In a nutshell, it exploits the fact that multiplication operation is very easy to do for computers (encrypt) but reverse, prime factorization, is extremely hard to do without knowing a key factor (decrypt). The numbers used in these operations are extremely large prime numbers. This is generally know as public key cryptography.
Encryption protects crypto-currencies. What protects encryption?
Value of crypto-currencies rests on trust in transparent production and secure spending; this trust rests on public key cryptography; and public key cryptography rests on the fact that computers can not hack it. The million dollar question is, how long before the computers can hack this cryptography? Gordon Moore, co-founder of Intel, had said that the computing power doubles roughly every two years. ‘Moore’s Law’ has held for quite a long time. However astonishing this rate of compute power progress may be, it still is not in position to pose a threat to public key cryptography. This is a false sense of security though as there’s a robust and powerful dark horse approaching: Quantum Computing.
While classical computers work by manipulating bits (can be 0 or 1), quantum computers manipulate qubits (can be any value in between 0 and 1). This is stemming from the difference between classical physics and quantum physics. Quantum computers exploit the spooky characteristics of quantum mechanics to achieve incredible performance. Theoretical physicist Richard Feynman is credited as one of the first scientists to imagine possibility of quantum computing.
The most basic quantum computer can potentially be many more times faster than the most powerful supercomputer.
Quantum computers can easily perform the necessary operations to hack the public key cryptography that underpins Bitcoin and other crypto-currencies. Problems that would take hundreds of years to solve with classical computers could potentially be solved by quantum computers in a flash. IBM has already unveiled a small quantum computer, IBM Q Experience operating around 20 qubits and recently revealed a working 50-qubit quantum computer. Google announced a 72 qubit quantum chip and Intel a 49 qubit chip. There are claims that 2000 qubit quantum computers are being built.
When we consider rate of progress for quantum computing, it is safe to say that there’s probably ten more years before the production mechanism of Bitcoin and other crypto-currencies could be compromised. Consumption side mechanism is more vulnerable though. The cryptographic part that ensures crypto-currency can only be spent by its owner is expected to be hackable by quantum computers as soon as 2027 and maybe even sooner. Even the probability of this happening in near future could have cascading negative effects as we approach that date. Once the trust is lost on the consumption side, production side would not matter and the whole system could collapse. What’s more this disaster scenario also holds for any e-commerce internet site as well.
So what can be done to secure transactions in a post-quantum world? Currently post-quantum cryptography research is mostly focused on six different approaches:
Lattice based cryptography: Lattice problems involve finding the center of grids in N dimensions.
Multivariate cryptography: Involves a scheme which is based on the difficulty of solving systems of multivariate equations and could be used for quantum secure digital signatures.
Hash-based cryptography: Their primary drawback is that for any hash-based public key, there is a limit on the number of signatures that can be signed using the corresponding set of private keys. This fact had reduced interest in these signatures until interest was revived due to the desire for cryptography that was resistant to attack by quantum computers.
Code-based cryptography: This includes cryptographic systems which rely on error-correcting codes, such as the McEliece and Niederreiter encryption algorithms.The Post Quantum Cryptography Study Group sponsored by the European Commission has recommended the McEliece public key encryption system as a candidate for long term protection against attacks by quantum computers.
Supersingular elliptic curve isogeny cryptography:This cryptographic system uses the well studied mathematics of supersingular elliptic curves to create a Diffie-Hellman like key exchange that can serve as a straightforward quantum computing resistant replacement for the Diffie-Hellman and elliptic curve Diffie–Hellman key exchange methods that are in widespread use today. Because it works much like existing Diffie–Hellman implementations, it offers forward secrecy which is viewed as important both to prevent mass surveillance by governments but also to protect against the compromise of long term keys through failures.
Symmetric key quantum resistance: Provided one uses sufficiently large key sizes, the symmetric key cryptographic systems like AES and SNOW 3G are already resistant to attack by a quantum computer. Further, key management systems and protocols that use symmetric key cryptography instead of public key cryptography like Kerberos and the 3GPP Mobile Network Authentication Structure are also inherently secure against attack by a quantum computer. Given its widespread deployment in the world already, some researchers recommend expanded use of Kerberos-like symmetric key management as an efficient and effective way to get Post Quantum cryptography today.
One common characteristic of many post-quantum cryptography algorithms is that they require larger key sizes than commonly used “pre-quantum” public key algorithms. There are often tradeoffs to be made in key size, computational efficiency and ciphertext or signature size. There’s still much to do; the cryptographic method needs to be perfected, standardized, and replace cryptography in a very large set of transaction processors. The quantum race has already started; welcome to the new age!
“..This is it, the apocalypse
I’m waking up, I feel it in my bones
Enough to make my systems blow
Welcome to the new age
I raise my flags, don my clothes
It’s a revolution, I suppose
We’ll paint it red to fit right in..”
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PS: I also wrote a book; realistically woven with AI, quantum computing, super intelligence, blockchain and other emerging technologies. You might enjoy it:
The Most Intelligent Person
Artificial & Un-Artificial Intelligence (Superintelligence)
“Grail Society’s goal is to acknowledge the most intelligent person ever on Earth, nicknamed “Thoth”. Since it is estimated that a hundred billion of the species Homo sapiens have lived until now, the ideal admission level is a score on an IQ test reached by one in a hundred billion persons. Even defining the selection criterion as “extremely rare” is not correct as there’s only and only one, The Genius, in the whole history of humanity and no other. We are living in extraordinary times. Artificial intelligence is emerging with a roar and super-intelligence is getting closer to being a reality. What if during these times there also was a race to find the super intelligent person. Would the contest to find “The most intelligent person ever” lead to breakthroughs in science, technology, and social sciences as well? What would be the rules of such a contest? The story is a thriller about the road to super-intelligence, artificial and un-artificial. The IQX contest takes us through a roller coaster ride through real challenging problems of our times. The reader learns about quantum computing, machine learning, artificial intelligence, morals & ethics for super intelligent machines and many other important topics of our times.”
Originally published in Science & Technology for Everyone Magazine, 2018