There is a technological arms race going on right now: blockchain against quantum computing. In principle, major breakthroughs in quantum computing may destabilise the whole cryptocurrency industry.
Unlike blockchain technology, which may be difficult to comprehend at first, quantum computing is a whole different situation. Because it is quantum, it is easy to argue that it might have a profound impact on everything. However, this is not completely true.
Quantum computing will be able to tackle certain problems far more rapidly than current computers — millions of times faster than they do now. Quantum computers will also eventually become very proficient at cracking cryptographic keys, which will be a huge concern for the crypto space.
Furthermore, it should be emphasised that developments in quantum computing may have an effect on more than just cryptocurrencies. It has the ability to impact all kinds of data that is protected by digital signatures, ranging from government encryption to financial institutions.
What Does This Mean For You As Crypto Investors?
The good news is that this is a well recognised problem and it is not going to escalate in the near future. Quantum computers will not suddenly become capable of decrypting encrypted data; according to computer experts, we will be aware of the situation long before it happens.
More importantly, blockchain technology is evolving in parallel with quantum computing, which is a major development. Some developers are already looking at post-quantum cryptography; this is enhanced encryption that quantum computers will not be able to decrypt, and scientists are certain that they will succeed.
Having said that, one of the most compelling advantages of blockchain technology is the near-impenetrability of its security measures. Breaking through such protections is, at the very least, concerning, and cryptocurrency investors should keep a watch on quantum advancements to avoid being caught off guard.
However, We Do Still Need To Be Prepared
We will almost certainly reach a moment when crypto investors will be forced to transfer their funds to more secure wallets in order to protect their investments. Given that data firm Chainalysis estimates 20 percent of Bitcoin is now missing or locked in wallets that users cannot access, these currencies (which cannot be moved) may be more vulnerable to attack.
Legislation is often cited as the most serious danger to cryptocurrencies, but other technological advancement also pose a threat to the cryptocurrency ecosystem, and we cannot neglect this.
New technologies that will replace blockchain may arise in the future, just as Bitcoin did not exist twelve years ago. Alternatively, like with quantum computing, the encryption of cryptocurrencies may be removed, and will definitely cause a danger for our crypto investment if we are not prepared.
There are various problems that the cryptocurrency and blockchain industries are already grappling with, ranging from scalability to long-term viability.
However, given the gravity of the threat, both industries must move swiftly to ensure that quantum computing does not compromise the basic security upon which it is founded.