Quantum Computing: The Cause of the Next Crypto Crash – Yahoo Finance

Quantum Computing: The Cause of the Next Crypto Crash – Yahoo Finance

The notion that a quantum computer might someday break bitcoin is quickly gaining ground. That’s because quantum computers are becoming powerful enough to factor large prime numbers, a critical component of bitcoin’s public key cryptography.

Quantum computers rely on what is known as Shor’s algorithm to achieve this feat. Shor’s algorithm dramatically shortens the time required to solve factorization problems. It’s also tailor-made for quantum computing, as it exploits the “superposition” of states used in quantum computing.

Unwinding Public Key Cryptography

The security behind wallet creation and transaction signing is predicated on public-key cryptography. What is public-key cryptography?

Let’s start by noting that Bitcoin’s protocol relies on an Elliptic Curve Digital Signature Algorithm (ECDSA) to create a private key and its corresponding public key. Bitcoin users should know about both.

Public keys employ a hash function to create your bitcoin’s public address (what you send and receive funds with). This public key itself was meant to be shared with other users. The fact that crypto users feel compelled to hide their public key suggests that the key system is inherently flawed.

Private keys are used to sign and validate transactions, and thus are kept secret.

While a user’s public key can be mathematically derived from his/her private key, private keys cannot be derived from public keys. This “one-way function” is dependent on the inability of any classical computer to easily factor large