From Qubits To Cryptos: What Quantum Means For AI And Bitcoin

Google's Willow Announcement (Photo illustration by VCG/VCG via Getty Images) VCG via Getty Images

Google’s Quantum Breakthrough: What It Means for AI, Bitcoin, and the Future

When I was at Davos earlier this year, I sat in a session on emerging technologies and the future of quantum computing. A speaker boldly claimed that quantum computers could one day outperform today’s most advanced supercomputers by such a margin that entire industries could be disrupted overnight. It was both thrilling and unnerving.

Sandy Carter heading to the Quantum Session at Davos 2024 Todd Allensworth

This week, Google’s Willow chip brought quantum computing out of the realm of theory and a major step closer to a future we can barely comprehend, still less predict.

Every industry needs to start paying close attention to developments in quantum computing, none more so than sectors where security is key. Or, like bitcoin, where it’s everything.

What is Quantum Computing?

Remember Schrödinger's poor cat, and how it was both alive and dead at the same time? This famous thought experiment illustrates the concept of superposition: the ability of quantum-scale systems to exist in multiple states simultaneously, until measured or observed. Government funding commitments for quantum total almost $40 billion, while private investments since 2021 total nearly $8 billion.

Quantum computing harnesses this property to achieve a revolution in processing power that leaves today’s most powerful computers look like dumb rocks in comparison. While classical computers use bits to process information as 0s and 1s, quantum computers use qubits, which can exist in superposition. This allows quantum computers to process vast amounts of data in parallel, solving problems that would take classical computers millions—or even billions—of years to crack.

Another key feature of quantum computers is entanglement, where qubits become interconnected and the state of one instantly influences the state of another, even across large distances. These properties enable quantum computers to perform calculations at speeds that are orders of magnitude faster than classical systems. However, building reliable quantum computers is a significant challenge due to issues like error rates and the need for extremely controlled environments.

Prince Constantijn of The Netherlands tries out the interactive science & art installation Quantum ... [+] Jungle by Robin Baumgarten (Photo by Patrick van Katwijk/Getty Images) Getty Images

Unlike classical data centers that rely on fans and hot aisle/cool aisle setups, quantum computers operate under extreme conditions. To maintain the delicate quantum states of their qubits, they must be cooled to near absolute zero—colder than outer space—using advanced cryogenic systems. This highlights the significant engineering challenges of scaling quantum technology, far beyond traditional computing infrastructure.

Google’s Willow chip represents a step forward in overcoming these challenges, particularly with its advancements in error correction and the development of "logical qubits," which are essential for scaling quantum systems. While we’re not yet at the point where quantum computers can disrupt major systems, each breakthrough brings us closer to that reality.

The Threat: Quantum’s Disruption of Security Systems

The potential of quantum computing to break existing encryption methods is one of its most alarming implications. Cryptocurrencies like Bitcoin, for instance, rely on asymmetric cryptography to secure transactions and wallets. This cryptography is based on mathematical problems that are incredibly difficult for classical computers to solve. However, quantum computers could solve these problems exponentially faster.

Experts estimate that a quantum computer with around 13 million qubits could theoretically break Bitcoin’s encryption in a single day. Today’s most advanced quantum systems are far from this level, with only a few hundred qubits, but progress is accelerating. This timeline—potentially within the next decade—is short when considering the long-term reliability required for blockchain and other encrypted systems.

Mati Greenspan, Founder of Quantum Economics Mati Greenspan

Mati Greenspan, Founder of Quantum Economics, told me, “The impact of quantum computing on Bitcoin will depend on how the technology is rolled out. If access is uneven, we could see a ‘wonky’ interim period where some actors gain significant advantage over others. While Bitcoin is not in immediate danger, the network will eventually require a major infrastructure upgrade to remain secure. Core developers should begin preparing now to ensure Bitcoin’s resilience in a quantum-powered world.”

The risks aren’t limited to blockchain. Quantum computing could expose sensitive data across industries, from financial services to healthcare. AI systems, which rely on encrypted data for training and operation, could also be compromised, threatening privacy and the integrity of AI models. This is a wake-up call for organizations to begin transitioning to quantum-resistant cryptographic methods.

The Potential: Quantum as a Catalyst for Innovation

While quantum computing poses significant risks, its potential to drive innovation is equally compelling.

For AI, quantum computing could drastically reduce the time required to train large models, enabling faster experimentation and deployment. Tasks that currently require weeks or months of computation could be completed in hours, unlocking new possibilities for AI applications in fields like natural language processing, drug discovery, and climate modeling.

Quantum computing could also revolutionize AI optimization problems. For example, industries like logistics and manufacturing could benefit from quantum’s ability to find the most efficient routes or configurations, saving time and resources. In materials science, quantum simulations could lead to the discovery of new materials with transformative properties, from superconductors to advanced batteries.

Christopher Penn, Chief Data Scientist at TrustInsights.ai, made some interesting points as well. “Over the years, Silicon Valley has revised downwards the expectations for AGI - artificial general intelligence - from being sentient, self-aware machines to “can do average tasks better than average people”. This rather disappointing turn is because today’s silicon-based computational architectures just can’t deliver the massive, near-real time parallelism that things like consciousness require. Even a mouse brain has more than 70 million interconnected neurons in a massive neural net; just replicating that compute power alone would take hundreds of megawatts of power and millions of GPUs. And the mouse operates on cheese and candy.”

Christopher Penn, Chief Data Scientist at TrustInsights.ai, Christopher Penn

“Quantum computing thus far is the only architecture that seems to promise the kind of parallelism necessary for creating sentient, self-aware computers. It’s still in its early days; most quantum computers operate around 1,000 qubits, well below the parallelism of even an insect, but the path forward seems clear. If recent advances in error correction hold, then there’s a path towards machine consciousness in quantum computing once you add a few more zeroes to the number of parallel qubits.”

For blockchain, quantum’s potential is twofold. While it threatens current cryptographic methods, it could also help solve existing challenges like scalability. Faster and more efficient blockchains could support the growing demands of decentralized applications, enabling more seamless integration of Web3 technologies into everyday life.

By integrating quantum-resistant cryptographic algorithms like those standardized by NIST or implementing quantum key distribution (QKD), Bitcoin could safeguard against quantum computing attacks. Decentralized governance, a cornerstone of Bitcoin’s philosophy, was built to allow the community to collaboratively adapt and upgrade the protocol as new challenges and technologies arise. As research in quantum cryptography advances, Bitcoin's protocol could be upgraded through this governance model to ensure it remains secure and viable in a quantum-enabled future.

Preparing for the Quantum Future

The convergence of quantum computing, AI, and blockchain presents both challenges and opportunities. To mitigate the risks while embracing the benefits, industries must act now. Transitioning to quantum-resistant cryptographic algorithms is a critical first step. The National Institute of Standards and Technology (NIST) has already developed standards for post-quantum cryptography, providing a roadmap for organizations to secure their systems.

In addition to cryptographic updates, researchers are exploring quantum-safe blockchains that integrate these new algorithms. These advancements will ensure that blockchain networks remain secure and reliable in a quantum-enabled future. For AI, adopting secure pipelines and encryption methods will safeguard sensitive data and maintain trust in AI-driven systems.

Collaboration will be key. Public and private partnerships can accelerate the development and adoption of quantum-resistant solutions. Investment in education and workforce development will also be essential to ensure that industries have the expertise needed to navigate this transition.

Where From Here?

At Davos, I left the session on quantum computing with a sense of urgency. The breakthroughs we discussed were no longer distant possibilities; they were rapidly approaching realities. Google’s announcement of the Willow chip is a reminder that the time to act is now.

But in all the excitement and anxiety surrounding quantum computing, one critical question often goes unasked: why do we accept the inevitability of whatever tech giants like Google create? It’s as if the world is handed a double-edged sword with a shrug\u2014“Here’s a machine that could solve humanity’s greatest problems but also dismantle global security as we know it. Use wisely!”

The burden of ensuring quantum computing serves humanity, rather than harming it, seems unfairly placed on everyone else—governments, developers, and industries scrambling to mitigate threats while tech companies continue to reap the rewards. If quantum computing is to shape the future responsibly, those inventing it must share accountability, committing as much to ethical safeguards and equitable deployment as they do to breakthroughs. It’s not just about building the technology; it’s about building a future where it benefits all and doesn’t leave the rest of the world cleaning up the risks.

The journey ahead will require innovation, foresight, and resilience. But the potential rewards—a future of faster blockchains, smarter AI, and groundbreaking scientific discoveries—are worth the effort. Quantum computing isn’t just a technological leap; it’s a paradigm shift that will reshape our world. Are we ready to embrace the quantum future?