Literature Review of the Effect of Quantum Computing on Cryptocurrencies using Blockchain Technology

TL;DR

This review assesses how emerging quantum algorithms threaten blockchain-based cryptocurrencies' security, analyzes current vulnerabilities, and discusses potential quantum-resistant solutions to safeguard digital assets.

Contribution

It provides a comprehensive analysis of quantum threats to cryptocurrencies and evaluates countermeasures like post-quantum cryptography and protocol modifications.

Findings

Quantum algorithms like Shors and Grovers threaten cryptographic security.

Major cryptocurrencies have specific vulnerabilities in transaction and consensus mechanisms.

Proactive adoption of quantum-resistant solutions is crucial for future security.

Abstract

With the advent of quantum computing, cryptocurrencies that rely on blockchain technology face mounting cryptographic vulnerabilities. This paper presents a comprehensive literature review evaluating how quantum algorithms, specifically Shors and Grovers, could disrupt the foundational security mechanisms of cryptocurrencies. Shors algorithm poses a threat to public-key cryptographic schemes by enabling efficient factorization and discrete logarithm solving, thereby endangering digital signature systems. Grovers algorithm undermines hash-based functions, increasing the feasibility of fifty one percent attacks and hash collisions. By examining the internal mechanisms of major cryptocurrencies such as Bitcoin, Ethereum, Litecoin, Monero, and Zcash, this review identifies specific vulnerabilities in transaction and consensus processes. It further analyses the current hardware limitations of quantum systems and estimates when such attacks could become feasible. In anticipation, it investigates countermeasures including Post-Quantum Cryptography (PQC), Quantum Key Distribution (QKD), and protocol-level modifications such as memory-intensive proof-of-work algorithms and multi-signature schemes. The discussion integrates recent advancements in quantum error correction, hardware scalability, and NIST-standardized cryptographic algorithms. This review concludes that while quantum computers are not yet advanced enough to pose an immediate threat, proactive integration of quantum-resistant solutions is essential. The findings underscore the urgent need for cryptocurrencies to adopt post-quantum cryptographic standards to preserve the decentralized trust, integrity, and security that define blockchain-based digital cryptocurrencies.