$28.6 billion worth of Bitcoin is vulnerable to quantum attacks, Deloitte report

• As per the report, BTC held in “pay to public key” addresses have higher risks of being attacked.
• Deloitte is developing new methods of cryptography to resist quantum attack.

According to the researchers at Big Four accounting firm Deloitte, four million Bitcoin (worth $28.6 billion) is vulnerable to attack from quantum computers. As per the firm’s new research report, BTC that are held in “pay to public key” (p2pk) addresses have higher risks of being attacked as their public keys are exposed on the ledger by default. The public keys can be used to derive a private key. 

These sorts of addresses were used formerly before the implementation of a new standard. The new standard, called p2pkh (pay to a public key hash), only exposes public keys when a BTC value is sent from an address. The analysis also shows that BTC transferred to a new, modern p2pkh address with zero outgoing transactions is at less risk of being attacked.  

Quantum computers use the properties of quantum mechanics. It uses atoms and molecules to create systems to explore multiple possible solutions to a problem, rapidly producing answers. It won’t be long before the quantum tech will be used to crack the encryption schemes that keep crypto assets as well as the internet secure. However, it will take some time before this is powerful enough to crack modern cryptography.

Deloitte also announced that they are developing new methods of cryptography that are resistant to quantum attack. The firm noted that it could be potentially integrated into the leading crypto assets. 

Even if everyone takes the same protection measures, quantum computers might eventually become so fast that they will undermine the Bitcoin transaction process. In this case, the security of the Bitcoin blockchain will be fundamentally broken.

The only solution, in this case, is to transition to a new type of cryptography called ‘post-quantum cryptography’, which is considered to be inherently resistant to quantum attacks. These types of algorithms present other challenges to the usability of blockchains and are being investigated by cryptographers around the world.