Quantum computing isn’t even here yet, but with the advent of robots, AI, 'big data' and all the other supposed innovations around the corner, it’s not surprising that some people are questioning what effect it may have (if any) on the prevalence of Bitcoin.
This article is aimed at understanding both.
Firstly, it must be stated that in order to correctly understand Bitcoin, you need to appreciate the underlying technology it requires. This is not some bandwagon 'investment' piece developed solely to piggyback the speculation-driven rise of Bitcoin.
Secondly, you need to appreciate the 'computing' has remained consistent forever (1+1=2).
What’s changed is the method by which computing has been achieved. With the introduction of the semiconductor, for example, the idea that computers could be miniaturized as well as increased in power became the norm. This not only leads to personal computers but also smartphones and, latterly, watches.
Despite the idea that 'quantum' computing could change things, the reality is that it will deliver JUST the same functionality as computers today. The difference – again – lies in how this will be facilitated. So in other words, to answer the core question of the article – NO, quantum computing will not affect Bitcoin. It may obsolete it with something better… but it won’t change its core predications.
This article is going to explain how quantum computing works, as well as how Bitcoin should fare in a quantum world…
Quantum Computing is Binary on Steroids
The whole point of quantum computers is to get MORE out of existing data capacity.
In a nutshell, it basically takes 'binary' (which is a logic gate that can either be 1 or 0) and makes it so that it can represent multiple values. This would not only MULTIPLY the effectiveness of current computing mechanisms but also open the door to NEW types of application & computer operations which were not possible before.
In other words, the supercomputers of today could be the smartphones of a quantum world. Sounds crazy but here’s the deal — the way that computers work today (as they have done since the 40’s when they were invented) is they store data as binary, or bits.
Binary is the language of using 1’s or 0’s to form complex operations. This is where the term "digital" comes from. Digital = precise (based on 1’s / 0’s), analogue = spectrum (0-9)…
For example, 1010(10) + 10100(20) = 011110(30)
These 1’s and 0’s are typically stored with what is known as 'transistors' – a simple electrical component which was created to preserve a state. The core of modern computing equipment are these transistors, millions of which sit at the core of modern CPU’s, GPU’s and memory.
HINT – the capacity of any components is typically driven by the number of transistors the manufacturer was able to put onto the components. This is how 'hard drive' capacity increases over time – more transistors in a smaller space.
EVERY time you use a digital computer, it’s basically taking your inputs and translating them into binary operations & digital numbers. Obviously, this gets quite in-depth so we’ll just say that due to the nature of transistors, they can ONLY be true or false at one time (not both).
This is how many of computing’s core methodologies (such as algorithm generation) is calculated – the system is able to rely on a particular way of doing things, typically because the way the logic gates work is always the same.
Quantum computing is somewhat different.
Rather than storing data as 1’s and 0’s, it actually has the capacity to store data as a range of values (hence the name). As such, the premise on which most of the modern computing world has been built is either going to change or at least adapt…
Bitcoin and Quantum Computing…
Bitcoin is basically built on the idea that you can store encrypted data through an algorithm.
The 'coins' themselves are simply files used to encrypt transactions stored in the Bitcoin blockchain database network. Each coin is really just a token which allows you to decrypt particular files/data in this database.
Whilst most people have gone crazy trying to trade Bitcoins (files) with other speculative traders, the reality is actually very simple – the algorithm, storage and processing facilities of Bitcoin would not be possible without digital and Binary.
ONLY when using a standardized protocol for being able to read, write and access data are people able to create applications (such as Bitcoin) which are able to work on 100,000,000’s or even 1,000,000,000’s of systems around the world.
To this end, the development of quantum computing will not change this.
It’s similar to the idea of 'electric' vehicles replacing the internal combustion engine – the method of achieving transport has changed, not the underlying need that people have.
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As such, the important point to consider about this is that much of the world has already digitized. The whole point of the technology booms of the ’80s (personal computers), '90s (GUI), ’00s (networking) and 2010s (mobile) was that it has constructed the equivalent of the road networks of a country. Much was akin to the US 'railroads' of the 1850s.
What we’re seeing with Bitcoin and Blockchain is an introduction to more ways of using these systems in a more effective way. If this means changing them to use quantum computing technology, so be it.
A "Quantum" Future…
Obviously, this is mainly wild speculation but has to be mentioned nonetheless.
Quantum computing technology will likely open up opportunities which had not even been considered before. Such things as going to Mars (and creating an interplanetary communications system) or having some other means of commerce whereby people are able to accept payments individually (as proposed by Bitcoin).
It may even be the case that Quantum technology would open the door to much more immersive and deeper experiences within the digital realm, with games and other entertainment experiences becoming a blend of visual and virtual mastery.
Ultimately, the core of the message is actually quite simple — regardless of what happens with the future of Bitcoin etc, the demand for the technology seems to be apparent. The difference lies in how it’s delivered.
So will Bitcoin be 'Vulnerable' to a Quantum Future?
The ONLY answer to this is to say that technology is – by its nature – self consumptive.
Technologies are obsoleted due to advances and adoption of other platforms (just look at VHS vs BetaMax). There will always be a place for Bitcoin but – as seen time and time again – the need for it will not diminish overnight.
The good news for any Bitcoin aficionados is the underlying premise of the technology (a 'cashless' or 'digital' economy) is still very much alive and will continue to be regardless of what type of underlying technology powers it.
Instead of worrying about the validity of quantum, it’s going to be better to consider whether the system is strong enough to keep people using it even if we went to Mars etc.