June 23, 2024
Quantum Threat
Technology

WEF Warns: CBDCs Vulnerable to Quantum Threat

In a recent development, the World Economic Forum (WEF) has sounded an alarm regarding the susceptibility of central bank digital currencies (CBDCs) to decryption attacks from quantum computer systems.

Quantum Computers: The Emerging Threat

The WEF’s cautionary note comes amidst the nascent stages of quantum computing. While still largely experimental, various proof-of-concepts exist, showcasing the potential of quantum systems to solve problems beyond the reach of traditional binary computers. However, the anticipated “Q-Day,” when quantum computers could compromise standard encryption, remains speculative.

Implications for CBDCs

The digital assets sector, including CBDCs, stands particularly exposed to this looming threat. According to the WEF, this vulnerability could potentially “break” CBDCs, emphasizing the urgency for preemptive measures.

Identified Threat Vectors

Highlighting the risks posed by quantum computing, the WEF outlined three primary threat vectors facing CBDCs. Firstly, there’s the concern that quantum computers could decrypt “in motion encryption,” enabling the interception of transactions in real-time. Secondly, identity impersonation could be facilitated by breaching encryption protecting identity verification systems. Lastly, the ominous prospect of “harvest now, decrypt later” looms, where encrypted data is stolen for future decryption by quantum systems, potentially unbeknownst to victims for extended periods.

Recommendations for Mitigation

To address these vulnerabilities, the WEF advocates for the integration of quantum-proof protections into CBDC systems, employing a strategy known as “cryptographic agility.” This approach allows for the adaptation and rotation of cryptographic algorithms in response to evolving threats, thereby fortifying CBDCs against quantum cyberattacks.

As central banks worldwide delve into the realm of CBDCs, the imperative of safeguarding these digital currencies against emerging threats like quantum computing becomes increasingly apparent. By embracing cryptographic agility and proactive measures, central banks can bolster the resilience of CBDCs in an ever-evolving technological landscape.

Image by freepik

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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