- Project Eleven aims to protect Bitcoin holders from quantum computers.
- It just raised $6 million to do so.
- But it’s unclear how it plans to turn a profit.
Project Eleven just bagged $6 million to secure the $2 trillion Bitcoin blockchain against the looming threat of quantum computers.
On Thursday, the group of cryptography experts announced the seed round, which was co-led by Variant Fund and Quantonation. Nic Carter’s Castle Island Ventures, Nebular, and Formation also participated.
It’s not entirely clear how Project Eleven plans to monetise its goal, but Alex Pruden, Project Eleven’s CEO and co-founder, said he was confident there was money to be made.
“If you don’t believe there’s a business opportunity somewhere in that $2 trillion — say, to build wallet infrastructure to help wallets manage the migration for users — then I think you have to be pretty bearish on Bitcoin and crypto generally,” Pruden told DL News.
The raise comes as quantum computing experts warn that Bitcoin could be at risk from cryptography-cracking quantum computers in as little as five years time. Yet so far, there’s no concrete plan to upgrade the blockchain to make it resistant to quantum computers.
“The entire Bitcoin protocol needs to be re-architected, tested, and every single wallet needs to migrate to a secure protocol,” Pruden said. “If that doesn’t happen then I guess the $2 trillion of value in Bitcoin goes to zero.”
Bitcoin development is conducted by a loose group of core developers who contribute to the project, often alongside other jobs. Private companies, NGOs, and wealthy Bitcoiners support them via grants and donations.
Some Bitcoin developers are already independently exploring ways to secure the blockchain against quantum computers.
Securing Bitcoin
The first facet of the Bitcoin protocol at risk from quantum computers are old Bitcoin wallets that use outdated cryptography, which includes Bitcoin creator Satoshi Nakamoto’s $115 billion stash.
However, eventually quantum computers will be able to crack the cryptography used in newer wallets, too.
Project Eleven’s aim is to eventually secure all Bitcoin wallets with so-called exposed public keys.
When a user sends Bitcoin, they must expose their wallet’s public keys. Normally this isn’t an issue as public keys are encrypted. However, with the advent of sufficiently powerful quantum computers, these exposed public keys become a target because they can theoretically be cracked.
Project Eleven estimates approximately $600 billion worth of Bitcoin in such wallets will be at risk in the future.
Ahead of a more permanent solution, the company aims to protect wallets with exposed public keys by enabling users to claim provenance over their funds using post-quantum cryptography.
To do this, Project Eleven is launching Yellowpages, a cryptographic registry designed to help Bitcoin holders prove ownership of their funds.
“With Yellowpages, we’re giving users free, audited, and open-source tools to proactively establish quantum-resilient ownership today,” Conor Deegan, co-founder and vice president of engineering at Project Eleven, said in a statement.
Yellowpages won’t solve the Bitcoin protocol’s vulnerability to quantum computers, but it will provide a fallback solution, allowing users to secure their Bitcoin holdings without immediate on-chain transactions or reliance on protocol upgrades.
Quantum advancements
Quantum computers exploit quantum mechanical phenomena to produce so-called qubits, the basic unit of information in quantum computing.
The quantum properties of qubits mean they can theoretically be used to create computers that are orders of magnitude more powerful than those that use conventional methods, meaning they could break advanced cryptography that secures encrypted data.
But quantum computers are difficult to build. The more qubits a quantum computer utilises, the more difficult it is to run computations with producing errors.
For many years, the development of quantum computers has been slow. But in recent months, several advancements have been made.
In December, Google unveiled a new quantum computing chip called Willow, which boasts a 56% improvement over the tech giant’s previous chip.
Then in February, Microsoft announced its own chip that it says solves the scaling issues that have persistently plagued the field.
Unconvinced
Yet some Bitcoin advocates, like Strategy Chair Michael Saylor, are unconvinced of the threat of quantum computers.
“I don’t worry about it,” Saylor told Bloomberg News on June 10. “Microsoft and Google market their quantum projects, but they would never sell a quantum computer that cracked cryptography as it would destroy their own companies.”
Pruden, on the other hand, believes Bitcoin will be future quantum computers’ number one target.
“An economically motivated actor will 100% go for Bitcoin versus something else like a bank,” Pruden said.
With Bitcoin, cryptography is the entire mechanism of ownership. Banks on the other hand, have a lot of legal and operational controls that could thwart a potential quantum computer attacker, he said.
Like other experts, Pruden estimates that quantum computers will pose a threat to Bitcoin within five to 10 years time.
“That’s probably how long it will take to fix and migrate everything,” he said.
Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips attim@dlnews.com.
