Europol warns quantum computing could threaten cryptocurrencies and encrypted data

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Key takeaways

Europol warned that quantum computing poses future risks to crypto and encrypted data.
Quantum computers could potentially derive private keys from exposed public keys.
The agency urged organizations to adopt post-quantum cryptography and crypto-agility.

The European Union Agency for Law Enforcement Cooperation (Europol) has warned that advances in quantum computing could pose significant future risks to cryptocurrencies and encrypted digital information, urging organisations, governments and the cryptocurrency industry to begin preparing now.

In two newly released reports, Europol examined how increasingly powerful quantum computers could undermine the cryptography protecting cryptocurrency wallets and potentially decrypt sensitive data collected and stored today for future exploitation. The agency noted that while the timeline for quantum computers capable of carrying out such attacks remains uncertain, adapting systems and coordinating security upgrades will require considerable time. It therefore stressed the importance of early action and greater “crypto-agility”.

Vulnerabilities in the cryptocurrency ecosystem

According to Europol, the primary vulnerability within the cryptocurrency ecosystem lies in the cryptographic keys used to control digital wallets and authorise transactions. A sufficiently powerful quantum computer could eventually derive a private key from an exposed public key, potentially enabling attackers to transfer funds without the owner’s consent. However, the agency said the cryptographic hash functions that support key elements of blockchain integrity appear comparatively resistant to quantum attacks, highlighting the need to focus protection efforts on more vulnerable areas.

The threat of harvest now decrypt later attacks

A separate report, developed jointly by Europol and Spain’s University Carlos III of Madrid (UC3M), highlighted the potential threat of so-called “Harvest Now, Decrypt Later” attacks. Under this approach, cybercriminals collect and store encrypted information today with the intention of decrypting it once more advanced computing capabilities become available. The report said the threat is particularly relevant to data requiring long-term protection, including government communications, intellectual property, medical records and law enforcement files. It added that there is currently no clear evidence that the technique is being systematically exploited on a large scale.

Calls for transition to post-quantum security

Europol called on organisations to identify where cryptography is used, determine which data requires long-term protection and develop phased plans to transition to post-quantum cryptography while maintaining compatibility with existing systems. The agency also emphasised the need for stronger wallet security and key management within the cryptocurrency sector, alongside greater cooperation between blockchain developers, wallet providers, policymakers and users to ensure a coordinated shift towards technologies that can withstand future quantum threats.

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