Google Willow sparks "quantum apocalypse" crypto flash crash panic

Google has announced that its flagship quantum chip has smashed a computational benchmark, sparking fear and panic among the crypto community.

Willow, a "state-of-the-art" quantum processor, took just five minutes to perform a standard computation that would have taken one of the world's fastest supercomputers ten septillion years.

Spelt out in numbers, that's 10,000,000,000,000,000,000,000,000 years - more than the age of the universe, which is roughly 13,800,000,000 years old (13.8 billion years).

News of the milestone appears to have sparked mayhem in the crypto markets, with the total market cap plunging by almost 4.6% to $3.46 trillion and the total market volume shooting up by 100% amid worries that crypto was doomed to be cracked wide open in an imminent quantum apocalypse.

Before we deal with those concerns, let's just take a look at the truly mammoth computational grunt power of the rather fey-sounding Willow chip.

"The Willow chip is a major step on a journey that began over 10 years ago," wrote Hartmut Neven, Founder and Lead, Google Quantum AI. "When I founded Google Quantum AI in 2012, the vision was to build a useful, large-scale quantum computer that could harness quantum mechanics - the 'operating system' of nature to the extent we know it today — to benefit society by advancing scientific discovery, developing helpful applications, and tackling some of society's greatest challenges."

A quantum leap for computing

Neven said his team has taken a significant step towards overcoming "one of the greatest challenges" in quantum computing: errors.

Qubits, the units of computation in quantum computers, rapidly exchange information with their environment, making it difficult to protect the information needed to complete a computation. With more qubits come more errors, pushing the system back towards classical computation.

In a paper published in Nature, Google published results showing that "the more qubits we use in Willow, the more we reduce errors, and the more quantum the system becomes".

Google engineers cut the error rate in half every time they increased the size of a physical qubit array, from a grid of 3x3 encoded qubits, to 5x5 and then 7x7.

Neven added: "In other words, we achieved an exponential reduction in the error rate. This historic accomplishment is known in the field as 'below threshold' - being able to drive errors down while scaling up the number of qubits. You must demonstrate being below threshold to show real progress on error correction."

He claimed Willow is a "strong sign that useful, very large quantum computers can indeed be built" and may even show that "quantum computation occurs in many parallel universes, in line with the idea that we live in a multiverse".

When the story broke, Twitter erupted with fears of an imminent quantum apocalypse, possibly causing a flash crash that wiped out more than a billion dollars off the market.

"Well… Bitcoin is dead," Geiger Capital told 164,000 followers. "Fun while it lasted. All of your passwords too."

Will quantum computers send Bitcoin to zero?

Not today. There is little doubt that at some point in the future, quantum computers will be able to crack current encryption standards. However, that moment is not now. And even when they do become capable of blowing crypto apart, the industry is highly likely to have moved to quantum-safe algorithms.

On LinkedIn, Glenn Rachlin, GTM of the Web3 security firm Blockaid, explained that Bitcoin relies on two types of encryption.

The first is ECDSA 256, which is vulnerable to Shor's algorithm. Many encryption schemes, such as RSA, rely on the difficulty of factoring large composite numbers into primes. Shor’s algorithm can perform prime factorization exponentially faster than classical algorithms, undermining the security of these systems.

"Cracking it would require over 1,000,000 qubits, Rachlin wrote. "Willow’s 105 isn’t even close."

The other is SHA-256, which is "even tougher" to crack and requires "millions of physical qubits to pose a real threat".

"Bitcoin’s cryptography remains SAFU [Secure Asset Fund for Users]... for now," Rachlin said.

Steven Rupp, Founder at Block9 & Elev8 Digital Services, shared an answer from Grok, which said: "The Willow chip cannot currently crack Bitcoin's hash due to the limitations in qubit count, error correction, and the sheer computational difficulty of the problem. The risk to Bitcoin's cryptography from quantum computing is recognized, but with present technology, it remains a theoretical rather than practical concern."

It is also worth pointing out that the crypto and security communities are not sitting around, waiting for the quantum apocalypse to wipe out the global economy.

Earlier this year, NIST (the US Department of Commerce’s National Institute of Standards and Technology) finalised three post-quantum encryption standards which are "designed to withstand cyberattacks from a quantum computer".

Meanwhile, increasing numbers of companies (many of them with the letter 'q' in their names) are working to devise protections against the incoming threat.

Yes, quantum could crack current encryption standards one day. We're glad to report that moment may be some way off, giving the world plenty of time to prepare.

Get in touch with jasper@machine.news to discuss your work in crypto, quantum or security.

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