Despite almost universal consensus that cryptocurrencies face an impending quantum threat, how likely is it that we quantum-proof blockchain technology? Not, can we quantum-proof the blockchain, but will we?

In 2017, researchers and analysts started to take the ‘threat’ quantum computing poses to cryptocurrencies seriously. For the uninitiated, the best way to think of a cryptocurrency is as the prize (also known as a token) won by smart people with powerful computers for undertaking a period of coding (this is called mining) that confirms the latest section (also known as a block) of an extremely long chain of transactions (referred to as the blockchain). Notably, these tokens don’t have any intrinsic value, we simply endow (some of) them with value because it’s believed these tokens will someday take the place of fiat money in the global economy.

Two significant studies were undertaken in 2017 – one at the University of Waterloo, and another led by Divesh Aggarwal of the National University of Singapore. Both reached the same conclusion: the imminent arrival of quantum computing threatens the cryptography securing the blockchain that substantiates every cryptocurrency.

Ironically, two existing quantum algorithms have the potential to undermine the two specific dimensions which establish and securitise blockchain technology. Shor’s algorithm opens the pathway to reverse engineering the key signatures that secure cryptocurrency wallets. Essentially, this quantum algorithm has the potential to break blockchain cryptography. Grover’s algorithm, on the other hand, could be used to mount an amplitude amplification attack to outpace the speed at which cryptographic miners can generate the consensus required to complete a block. In other words, a separate quantum algorithm solves the kinds of equations that validate transactions on the blockchain, “quadratically faster than any known classical algorithm.” Although there is debate around when quantum computing will be sufficiently advanced to cause havoc across crypto markets – ranging from as early as 2027 to an outside estimate of 2035 – there is remarkable uniformity surrounding how to prevent this kind of financial meltdown:

The long-term viability of cryptocurrencies requires that we quantum-proof the blockchain.

Quantum-proofing the blockchain can be approached from two angles: (1) “Patching existing blockchains against quantum attacks”; and, (2) “Designing quantum-resistant blockchains from scratch.”

Because there is considerable agreement about the problem and its possible solutions, some experts in the crypto space aren’t really that worried about the so-called ‘quantum threat.’ Arthur Herman, Senior Fellow at the Hudson Institute and Director of the Quantum Alliance Initiative, agrees with Roger Huang, a crypto-analyst and investor, when he writes: “cryptocurrencies can be updated to use post-quantum encryption standards and defend against these weaknesses.” This inherent potential leads Huang to conclude, no, “quantum computing will not break cryptocurrencies.” Herman, for his part, remains rather more circumspect, suggesting that, ultimately, the question hinges on “how fast large-scale quantum computers evolve.”

I’d like to approach the idea of quantum versus the blockchain from a slightly different perspective: how likely is it that we actually do quantum-proof the blockchain? Not, can we quantum-proof the blockchain, but will we? This might seem a strange way of formulating the question, but consider climate change. Since the 1970s, we’ve understood the risks our economic patterns of consumption and production pose to our planet, and smart people faithfully offered numerous mitigations and solutions. Sadly, however, very little of what is recommended has ever been meaningfully implemented. Resulting, needless to say, in the human-driven climate change in which we are all presently ensnared. In this context, it’s worthwhile asking if we actually will quantum-proof the blockchain? Just because we can, doesn’t mean we will.

Two issues occur to me. The first I’m calling the chicken and egg dilemma. The second I’m referring to as (to extend my zoo-analogical repertoire) the frog in the pot paradox.

The chicken and egg dilemma goes like this: If we are going to quantum-proof the blockchain (whether via ad hoc patch or sui generis quantum-blockchain) the quantum technology, necessarily, needs to be an existing fact. In other words, to protect against the quantum threat, in any meaningful way, quantum computing capable of causing disruption needs to exist so as to enable us to design appropriate response tools. This raises the obvious question: what is likely to happen first? Will the quantum computer be used to design a quantum patch, or, will the quantum computer, instead, first be used to break the blockchain? Generally speaking, people tend to install security systems after they hear about break-ins on their street. And, the Iron Dome defence system was developed after rockets started raining from the sky. Logically, it’s hard to develop an effective defence against a hypothetical threat. Typically, the break comes before the patch. After all, the little Dutch boy stuck his finger in a crack. He didn’t walk up to a solid foundation and wait for trouble…

The frog in the pot paradox describes the following scenario: The risk posed by quantum computing comes on by degrees, while, simultaneously, the benefits of cryptocurrency accrue, such that an equilibrium amount of threat is incorporated into our experience of cryptocurrency, thereby ensuring the crisis always takes us by surprise. This paradox is especially relevant in the context of two evolving technologies: blockchain and quantum computing. It is highly likely that as quantum computing advances, and despite many breakthroughs being achieved, the market for cryptocurrencies will simultaneously expand. This uncomfortable companionship – the advance of quantum computing and the expansion of crypto markets – will likely have the unintended effect of lulling investors, legislators, and the public into a false sense security. This is not so dissimilar to the climate change paradigm: although most people would be loathed to admit it, because life and economics seems to rattle on relatively unhindered for populations in OECD nations (despite being constantly reminded about increasing global temperatures, frequent dramatic weather events, shrinking ice caps, and ecological loss). It ‘seems like’ the threat of climate change has somehow been incorporated,  something we have simply come to live with,  something we have adapted to, at no significant cost. This hubris will undoubtedly, someday, be unmasked by a tipping point. The same situation could very well evolve with respect to the quantum threat.

So where does this leave us? I believe either the chicken and egg dilemma or the frog in the pot paradox will prove our undoing. If I had to stake a claim, I’d wager that despite agreement concerning the problem and the solution, we won’t quantum-proof the blockchain before we reach the tipping point. In fact, isn’t this the precise paradox in which we have been entangled in the decades leading to the present coronavirus pandemic? Having managed to muddle our way through SARS in 2002 – 2004, H1N1 in 2009, and Ebola in 2013 – 2016, our elites didn’t consider the risk worth the prevention investment. This hubristic disposition seems endemic to the human condition. In the end, all the ink spilled since 2017 on the impending quantum threat will likely read like historical prophecy. In the same way that Bill Gates’ TED talk in 2015 positioned him as the global authority on COVID-19, perhaps Arthur Herman or Roger Huang will be catapulted to international prominence in the midst of an ‘unanticipated’ blockchain crisis.