How Quantum Computing Could Threaten Bitcoin’s Future
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Welcome to Tech News Briefing. It's Tuesday, January the 7th. I'm James Rundle for The Wall Street Journal. Generative artificial intelligence is supercharging robots. We'll hear why advancements in AI mean you might just start seeing robots appear everywhere, from the grocery store to the hospital ward. And then, quantum computing holds enormous promise for solving some of the world's most difficult problems, but it could also break some of its strongest protections, particularly in cryptocurrency.

Our reporter Alexander Ozapovich joins us to discuss. But first, generative AI is everywhere, from computer art to corporate chatbots. But where it might have one very visible impact is in the way robots will start to creep into our everyday lives. Once the stuff of science fiction, researchers are now looking at how AI can help power robots that stock shelves in supermarkets, cut vegetables in kitchens, and even deliver prescriptions in hospitals.

WSJ reporter Isabel Busquets joined Cordelia James to talk about the rise of the robots. Here's their conversation. Isabel, how do these robots work traditionally and how might generative AI give them a boost?

Yeah, so traditionally we think about robots as needing to operate in really structured environments. They're trained to do narrow and specific set of tasks, and they have to do those tasks in an environment that they're familiar with, they've been trained on, and they really run into a lot of problems when the environment they're in or the world they're in is not exactly what they were trained to expect.

And in the normal human world that we operate in, we know that's always the case. Not every door opens the same way. And sometimes there are objects that, you know, appear in our path and robots don't always know that or they haven't always known that. And...

What generative AI provides is basically the supercharged robot brain that allows them to think more critically. They can recognize objects they haven't seen before. They can replan their route to get around something if they encounter an obstacle and

We'll also be able to talk to them in natural human language. Think of the way we converse with ChachiBT and order it around a hospital or a retail store or whatever it is. I'm really excited to potentially see this in my everyday life, but I have yet to spot any of these robots out in the wild. Where might people start to encounter them in their everyday lives?

We're starting to see more robots in restaurants. They can cut vegetables. They can start to do some of those like more repeatable tasks that happen in say a fast food restaurant. We're starting to see them in retail stores like Sam's Club has robots that go around and clean the floors and at the same time are checking out inventory levels all around. I

And then we're also starting to see them in entertainment spaces. There's a company called Engineered Arts, and the robots aren't really designed for doing labor the way a lot of other robots are, but are more designed to interact with people and entertain them. And, you know, we've seen those museums, hospitals, and healthcare is another area where there's a lot of potential. They roam around the halls, deliver towels, deliver medicine, and

and just sort of lighten the burden on nurses there. What are some situations where they might not be so great right out the gate? In the retail example, they're great at going around the floor and they can clean and they can track where inventory is with cameras and sensors. What they're maybe not the best at yet where there's potential is maybe actually doing some of that restocking. Picking up objects is something that's actually...

really, really hard for robots and you wouldn't think about it because it's something that's so easy for humans. And you know, a robot doesn't necessarily know how to pick up something that is really heavy and needs to be grasped really hard versus something that is delicate and a different shape or shouldn't be grasped as hard or else it'll break. In the hospital example, there's also some work to do there. Every hospital is set up differently. Just the variation in layout is a hard navigation challenge.

Especially when you think about them riding up and down elevators and, you know, does the hospital have to set aside a specific elevator just for the robots to go up and down? Some of the robot operators want the hospitals to standardize their layouts in order for the robots to navigate better, but that's just something that's not really going to happen. In this case, it's really up to the robots to get smarter about how to navigate the human world. That's something where generative AI has the potential.

That was our reporter Isabel Biscuit speaking to Cordelia James. Coming up, quantum computing might just be powerful enough to break through Bitcoin's strongest protections and enable heists on a global scale. That's unless experts can stay one step ahead of the crooks in a major tech arms race. We'll explain after the break.

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Bitcoin's seemingly unstoppable march to $100,000 in value per coin has emboldened its supporters, who see cryptocurrency as a safe, secure form of money. Quantum computing could upend all of that.

Experts worry that the massively enhanced computing power of quantum systems could easily break the encryption at the heart of cryptocurrency transactions, enabling thieves to steal on a breathtaking scale. Here to tell us about the threat is WSJ reporter Alexander Ozapovich. So Bitcoin theft isn't exactly uncommon. What makes this threat different? There have certainly been many thefts of Bitcoin in the past.

Typically what happens is a hacker breaks into the systems of some crypto exchange and finds the so-called private keys lying around. The private keys are essentially kind of a password that you need to access the digital wallet where your Bitcoin is stored. If you can get a hold of them, you can transfer Bitcoin out of that particular wallet. The issue with quantum computing is that potentially you could essentially figure out the process

private keys to a digital wallet simply by doing a whole bunch of math and figuring out those keys. You wouldn't need to like break into a system somewhere to do it. And this would imperil essentially all Bitcoin everywhere, not just some in a particular poorly secured crypto exchange. So what is quantum computing in a nutshell and how does it differ from classical computing?

In classical computing, the kind of computers that you and I have, all data is fundamentally represented as either a 1 or a 0. That's the building block of everything else. Audio files, movies, they're all 1s and 0s in sequence.

Quantum computing, the building block is something called a qubit. It takes advantage of some of the weird properties of quantum mechanics to have a state that is either one or zero or something weird in between.

And this allows you to do certain types of computations much more quickly with a quantum computer than you can with a traditional computer. You can essentially power through a whole bunch of different possibilities more quickly and things that would take forever to do with a traditional computer could be done relatively quickly with a powerful quantum computer.

So there are quantum computers now. IBM is an example of a company that has one, Google. But when is this likely to become a real threat? The tech isn't quite there yet, right? Quantum computing is in a very early stage right now. It's probably years away from being a threat to encryption.

The problem is that we don't quite know how quickly it's going to advance, and technological change has a way of sneaking up on you. If you remember when chat GPT suddenly burst onto the scene and we were living in this world where computers could talk to us in lifelike ways and generate these incredibly realistic images, it's possible something like that could happen with quantum computing a few years down the road. Are there efforts to produce quantum-resistant cryptography encryption?

Yes, in general there are ways of having quantum resistant encryption. This is relevant to traditional finance as well. A lot of the underlying encryption algorithms in Bitcoin are also used for things like internet e-commerce and there has been sort of a government and private industry effort over the years to develop a new standard of encryption that would be resistant to quantum attacks.

Bitcoin is sort of its own thing that was created by Satoshi Nakamoto, an anonymous developer in the late 2000s. And it's supported by essentially a network of enthusiasts. It would be possible to upgrade Bitcoin to make it quantum resistant, but it would be a very heavy lift. Yeah, given that in mind, is it also difficult to put any kind of regulatory protection there? I mean, most traditional banks have deposit protection through the FDIC, for instance.

Is it even possible to do something similar in crypto or any desire for it? One of Bitcoin's features is that it's unregulated and run by its users, doesn't have sort of central middlemen or an oversight authority looking over it. And that has some advantages, but a major disadvantage is that essentially you have no recourse. If, for instance, your bank account gets hacked and somebody steals funds from it, they're gone.

So should Bitcoin holders be worried now? And if so, what can they do? There is a range of views about this in the Bitcoin and cryptocurrency communities. Some people feel that the risk to Bitcoin from quantum computing is a long ways off.

and nothing imminently needs to be done. But there are also efforts underway to try and at least start a discussion about how could you quantum proof Bitcoin. There are proposals out there, there are people who talk about this sort of thing at Bitcoin conferences. I would say that in general, there hasn't been a lot of momentum around this. Bitcoin has gone through a couple of different upgrades in its history. These have tended to be slow moving and contentious processes.

And I don't know that people have appetite for another one. Because it's such a decentralized network, you have to have buy-in from a lot of different parties to upgrade Bitcoin. And upgrading to make it quantum resistant would be no different. That was our reporter, Alexander Ozapovich. And that's it for Tech News Briefing. Today's show was produced by Julie Chang, with supervising producer Catherine Milsop and deputy editor Scott Salloway. I'm James Rundle for The Wall Street Journal. We'll be back this afternoon with TMB Tech Minute. Thanks for listening.