Coinbase is preparing for future scenarios where quantum computers may be able to crack Bitcoin’s current cryptography.
America’s biggest crypto exchange said Thursday that while the threat isn’t imminent, hard problems — such as migrating millions of users and coordinating protocol upgrades across decentralized systems — need to be solved.
Quantum computers are still experimental and make mistakes but some in the crypto community have sounded the alarm about hypothetical advancements in the machines that could in the future be able to break Bitcoin’s cryptography.
“There’s a lot of noise about quantum computing right now,” Coinbase said. “Some of it is hype. Some of it is fear. And some of it is real.”
The publicly-listed company added that a large-scale quantum computer capable of breaking current cryptography will eventually be built, and so the work to prepare needs to start now, “not when it’s urgent.”
The gameplan
The exchange added that its Independent Advisory Board on Quantum Computing and Blockchain, formed earlier this year, plans to deliver a post-quantum signing pipeline using secure enclaves and threshold cryptography.
Coinbase said that currently, its key management system protects approximately 99.9% of the assets the company custodies. But within the next year, the company will deliver an automated signing pipeline that will allow quantum-safe custody as soon as blockchains begin adopting post-quantum schemes.
It added that it was bringing together Bitcoin core developers, cryptographers and researchers to discuss post-quantum migration strategy, with plans to continue these regularly.
“Preparing Bitcoin for a post-quantum world is one of the most consequential and complex challenges the protocol has ever faced,” the exchange said.
Coinbase is also a founding member of the new Bitcoin Security Consortium — alongside BlackRock, Fidelity Digital Assets, Block, and others — which donates funds and dedicates engineers to open-source work supporting proposals like BIP-360.
The quantum “threat”
Crypto companies and protocols have been planning for a hypothetical future where quantum computers can break top cryptography ever since Google researchers last year said that improvements in the computers may allow them to be able to break the cryptography protecting major cryptocurrencies in just nine minutes.
Some in the community have called the warnings overblown, but others have already started preparing for a post-quantum future by testing quantum-resistant signatures on live sidechains.