One of my favorite descriptions of Bitcoin comes from the great oracle of this field, Andreas Antonopoulos. He called it a "sewer rat."
Antonopoulos' unflattering comparison is actually an expression of respect. What he means is that Bitcoin is a survivor that has developed a strong resilience due to the fact that it has been exposed to threats, much like contact with germs helps people develop an immune system. Bitcoin has survived several crises - from Mt. Gox to China's mining ban - and has emerged stronger from each, with a higher hashrate, improved economic security, growing user numbers, falling transaction costs and more efficient processing.
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In many ways, the leaderless, amorphous ecosystem that Bitcoin is driving embodies Nassim Taleb's idea of an "antifragile" system (although Taleb has recently become a fairly prominent Bitcoin critic). It offers a good reason to believe that Bitcoin will bounce back stronger from recent setbacks in the cryptocurrency markets.
As many die-hard believers will attest, Bitcoin's durability is due in large part to how hard it is to change the protocol. As we learned from the block size wars, when a lobbying campaign by powerful interests failed to find support for increasing Bitcoin's data capacity, it takes an overwhelming consensus among both users and miners for significant code changes to be adopted. This gives the system certainty and inspires confidence in the demonstrable scarcity it promises.
Still, it would be naïve to believe that Bitcoin is completely invulnerable to outside threats. In fact, one threat in particular that has received too little attention is now greater than ever: quantum technology. And in this case, Bitcoin's characteristic of being "hard to change" may prove to be a flaw, not a feature.
A long wait
Quantum computing has been on the rise for four decades, but has been delayed because of the highly complicated technical challenges that must be overcome before it can achieve the kind of supercomputing power it promises on a large scale. This slow process is why some people, including many in the cryptocurrency industry, believe it will never come.
Recently, however, computer scientists have discovered new uses for the field's computational techniques in conjunction with graphics processing units (GPUs). They foresee powerful applications without having to wait for the development of a full quantum computer.
The potential for rapid processing of massive amounts of data to accelerate research in areas such as battery technology has generated excitement. It has also fueled concerns that the encryption systems on which our digital economy depends could be cracked by attackers using quantum tools.
As a result, scientists are working together to publish a set of open "post-quantum cryptography" standards to "quantum-proof" our computer systems. In a recent article in Nature, a group of these scientists laid out a transition strategy supported by the U.S. National Institute for Standards and Technology (NIST) and its foreign partners.
A Biden administration memo last month outlined "key steps needed to maintain the nation's competitive advantage in quantum information science (QIS) while mitigating the risks of quantum computing to the nation's cyber, economic, and national security." It directed "specific actions for agencies to take as the United States begins the multi-year process of transitioning vulnerable computer systems to quantum-resistant cryptography."
One of the scientists behind the initiative, Jack Hidary, the CEO of Sandbox AQ, is now on a mission to convince crypto developer communities to begin what will likely be a long process of transitioning to post-quantum standards before their blockchain protocols become unusable.
"This process of transitioning all blockchains could take four or five years, and that's part of understanding why we need to start this process now," he said in an interview that ran last week on the special edition of the World Economic Forum's "Money Reimagined" podcast.
Bitcoin's resilience in the sewer won't protect it here. Although its key pair system is based on Elliptic Curve Cryptography (ECC), an advance over the ubiquitous RSA public key cryptography system used in most encryption systems, research has shown that EEC cannot withstand quantum processing, Hidary says.
That means a third party could use a super-fast "brute force" quantum computation to quickly uncover the private key you're secretly guarding to unlock and trade Bitcoins referenced on the public blockchain.
Trade now, trade later or never?
Will blockchain developers get in on the action?
To update the code of a company-owned website, it is enough for the CEO or technical director to instruct his staff to do so. However, a widely used, decentralized, open-source protocol whose value depends on a network of users can only be meaningfully changed if a large enough majority of participants accept the code change.
We know not only from the block size wars, but also from how long it took for less controversial upgrades like Taproot to be adopted, that consensus building in Bitcoin can be particularly difficult and time-consuming - in part because so much money is at stake.
You would think that if these computing advances posed such an existential threat, change would happen quickly. People will preserve something they've invested in, one would think.
But such an upgrade requires far more than a few lines of code. It means an overhaul of the entire cryptographic foundation and requires commitment from all players in the Bitcoin economy. It will take many meetings and a lot of arguments over Twitter and IRC to get everyone on board. Bitcoin's resistance to change could be an obstacle.
Inevitably, some will distrust these academics who make threats and promises. Companies like Hidary's offer services to solve these problems for blockchain developers. Is this solution as urgent as he claims? My head hurts when I think about the fights, the accusations, and the conspiracy theories.
The truth is that no one knows how long it will take for quantum physics to become advanced and accessible enough to pose a threat to blockchains. But can the community afford to wait?