Is Quantum Computing a Real Threat to Bitcoin? Here’s What You Need to Know

Bitcoin’s recent surge to over $106,000 is facing a potential threat from the rapid advancements in quantum computing. Experts warn that if Bitcoin doesn’t adapt its encryption methods, it could be vulnerable to attacks that would compromise its foundational security. According to a study from the University of Kent, updating Bitcoin’s protocol to defend against quantum threats could take over 300 days of downtime.

The Quantum Threat to Bitcoin

The study suggests that if Bitcoin were to implement a full protocol update, it would require 76 days of complete downtime. More realistically, if Bitcoin allocates 25% of its server for the update while allowing users to continue transactions at a slower pace, the downtime could extend to approximately 305 days—nearly 10 months.

Carlos Perez-Delgado, a senior lecturer at the University of Kent and one of the authors of the study, highlighted the staggering costs associated with this downtime. Just one hour of downtime can cost businesses around $500,000. Therefore, if Bitcoin were to experience 76 days of downtime, the estimated cost could reach $912 million.

The Urgency of Update

Perez-Delgado emphasizes that the need for a protocol update is urgent due to the imminent capabilities of quantum technologies. For instance, Google’s Willow chip can theoretically perform computations in a mere five minutes that would take the best supercomputers 10 septillion years. This rapid advancement has raised concerns among experts regarding the security of current encryption systems.

The Mechanics of Quantum Computing

Quantum computing operates using qubits, enabling it to perform multiple operations simultaneously, unlike classical computers that rely on binary bits. This capability poses a significant risk to cryptocurrencies that rely on public-private key encryption.

For centralized entities like Google, updating encryption methods may be straightforward. However, for decentralized systems like Bitcoin, the process is not as simple due to the lack of a central authority. With approximately 275 million Bitcoin investors, coordinating a seamless update becomes a complex challenge.

Alternative Solutions

While Perez-Delgado does not view his findings as a death sentence for Bitcoin, he acknowledges that there are alternative solutions, such as de-throttling or increasing the block time, which could help manage a major update. However, these alternatives may also impact the platform’s ability to handle user traffic effectively.

The overarching message is clear: the rise of quantum computing presents a serious challenge to Bitcoin’s security, and proactive measures must be taken to safeguard its future.