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1. Decrypting Crypto: Cryptocurrencies and the Quantum Computer Threat

Author:
Arthur Herman and Daley Pagano
Publication Date:
04-2022
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Cryptocurrencies are increasingly embedded in the global financial and economic mainstream. One reason is that its security encryption, distributed ledger technology, or blockchain, is largely impervious to conventional cyber-attack or theft. However, thanks to Shor’s algorithm, cryptocurrencies will be exceptionally vulnerable to a future quantum computing attack. What makes crypto vulnerable to Shor’s algorithm is elliptic-curve cryptography, which applies to all distributed ledger technology. Based on our research, the overall cost of a major hack and devaluation of Bitcoin alone would equal $3 trillion plus. Fortunately, solutions already exist: post-quantum cryptography and quantum computing. Cryptocurrencies are here to stay. However, supporting crypto security with post-quantum cryptography or quantum cryptography will enable cryptocurrencies to remain a mainstay of the global financial system for many decades to come.
Topic:
Science and Technology, Innovation, Cryptocurrencies, Information Technology, and Quantum Computers
Political Geography:
Global Focus

2. Advancing the Quantum Advantage: Hybrid Quantum Systems and the Future of American High-Tech Leadership

Author:
Arthur Herman
Publication Date:
11-2022
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Quantum computers mark a transformational revolution in information technology. Whereas most computers process data using bits that consist of either a zero or one, quantum computers can use those digits simultaneously through superposition.1 The many resulting benefits will include the discovery of new drugs, new processes for carbon capture and advanced battery research, and a new exactitude in weather prediction, including in dealing with climate change.2 All in all, experts expect the global quantum computing industry to grow to $450–850 billion in value in the next 15 to 30 years.3 Yet because of the challenges of engineering qubits—the physical basis of quantum computing—most authorities push the timeline for full-scale quantum computer commercialization beyond 2040 and as far as 2050. Even some quantum experts do not expect any big breakthroughs until the 2030s at the earliest. The true path to the quantum future is the combination of quantum and classical digital technology, especially in computing, which will powerfully accelerate access to the potential benefits of quantum information science. While key players in the industry, including IBM and Microsoft, have recognized the potential synergy of hybrid architectures and applications, the federal government needs to expand its attention and resources devoted to this aspect of securing America’s quantum future and its leadership in the twenty-first century.
Topic:
Defense Policy, National Security, Science and Technology, Leadership, Innovation, and Quantum Computers
Political Geography:
North America and United States of America

3. Powering Innovation: A Strategic Approach to America’s Advanced Battery Technology

Author:
Nadia Schadlow, Arthur Herman, and Brayden Helwig
Publication Date:
10-2021
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Changing consumer preferences and government policies point toward widespread future adoption of electric vehicles (EVs). Advanced lithium batteries are the primary power source for EVs. Unfortunately, China dominates today’s battery supply chain, from the extraction and processing of critical minerals like lithium to the production, packaging, and recycling of battery cells. In today’s era of great power competition, control of the supply chains for advanced technologies such as lithium batteries will have a direct impact on national power. Advanced battery technology will go a long way toward determining economic leadership in the EV market. The automobile industry is one of America’s largest manufacturing sectors and accounts for some 3% of US GDP. But EVs and advanced batteries also have important military applications. EVs will function as mobile energy nodes on the battlefield, providing power for unmanned systems, communication links, electromagnetic warfare systems and more. These capabilities will help the US military conduct more decentralized operations in contested regions.
Topic:
Science and Technology, Innovation, and Batteries
Political Geography:
North America and United States of America

4. Risking Apocalypse? Quantum Computers and the US Power Grid

Author:
Arthur Herman and Alexander Butler
Publication Date:
12-2021
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Millions without power; stores and banks shut down; vital services running on emergency generators, if at all; lines of hapless people awaiting food and water. The experience that the state of Texas underwent during February 2021 is only a preview of what we would all face should the United States’ ever-vulnerable energy grid be subject to a major cyberattack. For years, experts have been warning us of the national power grid’s vulnerability to attacks by such malicious actors as Russia, China, and Iran. A major task force within the US Department of Energy—the North American Energy Resiliency Model (NAERM)—has been tasked with determining how best to protect our energy grid from damage caused by not only natural disasters but also terrorism and cyber assaults. NAERM’s purview, however, encompasses only existing, conventional cyber threats and does not extend to quantum computer attacks, whose effects would be far more protracted and far worse than those of a conventional cyberattack. Indeed, the “smarter” a grid is, that is, the greater the extent to which it relies on computer supervision and control, the more vulnerable it would be to such an attack. The shutdown resulting from an attack by a future quantum computer, with its unprecedented power to easily decrypt existing encryption systems, could be the most catastrophic disaster our country has ever experienced. Using data supplied by global econometrics firm Oxford Economics, researchers at Hudson Institute’s Quantum Alliance Initiative are conducting a quantitative study designed to model the impact of a hypothetical future quantum cyberattack on the US power grid, and preliminary results indicate that protection of our power networks needs to be an urgent national priority. The study’s preliminary results offer important clues as to the areas on which policymakers should focus, not only to secure our power and energy grid from a large-scale quantum computer attack but also, in the event this were to be unsuccessful, to mitigate such an attack’s impact on our infrastructure, both in terms of economic and national security. As Hudson Institute founder Herman Kahn wrote in his 1962 book Thinking About the Unthinkable, “Even the most utopian of today’s visionaries will have to concede that the mere existence of modern technology involves a risk to civilization that would have been unthinkable twenty-five years ago.” Today, we must once again consider the unthinkable, not the nuclear apocalypse that haunted Kahn and his generation in the 1950s and 1960s but a quantum apocalypse that, if not as physically and permanently destructive as a nuclear attack, could cause catastrophic harm to our economy and society unless proper steps are taken now to mitigate such an attack’s attendant risk.
Topic:
Defense Policy, National Security, Science and Technology, Cybersecurity, and Electricity
Political Geography:
North America and United States of America

5. The Executive’s Guide to Quantum Cryptography: Security in a Post-Quantum World

Author:
Arthur Herman
Publication Date:
05-2020
Content Type:
Working Paper
Institution:
Hudson Institute
Abstract:
This guidebook answers key questions about how quantum technology itself, in the form of quantum random-number generators (QRNG) and quantum-key distribution (QKD), can provide secure solutions for addressing the quantum computer threat. After explaining how QRNG and QKD work, the guidebook recommends that executives combine these quantum cryptographic solutions with other software-based, quantum-resistant applications that can deter future quantum computer attacks. Finally, the guide shows how quantum science will determine the future of communication technology by making it safe, secure, and ready for the twenty-first century.
Topic:
Security, Science and Technology, Business, and Quantum Computers
Political Geography:
Global Focus