Security Notes: Prepare for Quantum Randomness

Until the early years of the 20th century the world was modeled as a Rube Goldberg contraption, where a series of levers, handles, belts, and wheels create a long sequence of well-anticipated actions.

Quantum trashed this model and replaced it with cosmic dice. The claim of quantum physics is that the dice that determine reality are perfect. It happens like a recurrent burst of creation, following no rule or law. What’s more, the unpredictable dice show coordinated choice across vast distances. Baffled physicists resign themselves to mathematically describing this phenomenon, called “entanglement,” and just use it.

It turns out that, by stringing together microcosmic dice and applying measurements to such strings, it’s possible to replace the old Turing machine, which is, in fact, a Rube Goldberg contraption. It’s also the basis of all the computing devices that run digital transactions today. While this replacement still has some engineering work to be done, quantum randomness per se is already in use.

Digital transactions flow on public information highways, protected with keys that are a sequence of binary bits. If a hacker somehow guesses the key, he is exposed to the transaction data. To prevent such guessing, the industry uses algorithms that generate keys that look perfectly random to the naked eye. However, as the father of computers, Von Neumann, said: “If you use algorithms to generate randomness, you understand neither algorithms nor randomness.

Imperfect keys are a persistent window of vulnerability for all network-dependent digital transactions. Quantum randomness lends perfection to ordinary keys to ensure that they are guess-resistant.

In 1917, a Bell Labs engineer, Gilbert S. Vernam, filed an encryption patent that was eventually found to  enjoy mathematical perfection. We have not used this unbreakable cipher in digital transactions because it requires large quantities of quantum-grade randomness.

But while there was no technology then to manufacture the required randomness, today we have plenty of ways to generate such randomness, and as a result this Vernam cipher and a series of more modern Trans-Vernam ciphers offer the assurance of safe transport of digital-transaction data over the Internet—except, as always, when the implementation is sloppy.

More recently, quantum randomness was built into a new financial language. Computers today express monetary value as a number written in coded bits. Hackers flip these bits and cause chaos. Quantum randomness is used as a means to express financial instruments in a way where their value and their identity are bonded and fused. This is similar to the bond between a dollar bill and the serial number marked on it.

This fusion of value and identity creates an option to link a financial instrument to particular terms. A digital mint can specify that a particular $100 digital coin belongs to Jerry,  so if Ben steals it, he can’t use it. The payer of such digital money may also limit its use: good for groceries, not good in a casino.

The value, the identity, and the terms are encrypted together with quantum-grade ciphers and, thereby, create a landscape of digital transactions way beyond what is happening today. The book “Tethered Money” elaborates how the full measure of payment, and its disposition as described in detailed business contracts, may be inscribed in a digital coin constructed with quantum randomness. This means limitation of use is enforced through technology rather than through swarms of accountants and lawyers.

Quantum randomness powers the universe, while its mystery defies our imagination. We’d better be clear about this, and humbly admit it while we get busy using this mystery in practice. It is rising to become the foundational pillar of all digital transactions.

—Gideon Samid, gideon@bitmint.com