Even if Ethereum researcher Justin Drake's judgment that artificial intelligence might crack cryptography is ultimately proven correct, critics still argue that the "escape mode" (bunker mode) is an unrealistic suggestion and is likely unable to protect your encrypted assets.

If the rising geopolitical tensions are not enough to cause concern, then it's time for the crypto industry to "enter nuclear alert mode."

There is a heated discussion in the industry about a cryptographic doomsday scenario: attackers could use a scenario that previously seemed unattainable but now may be more plausible – AI – to derive private keys from public keys, thereby putting everyone’s encrypted assets at risk.

Drake called for the establishment of a "refuge mode" plan last Wednesday, on the grounds that the "humbling" progress of artificial intelligence could accelerate the discovery of mathematical attacks, ultimately "cracking" cryptography:

In my opinion, it is reasonable to prepare now for the possibility that the ECDSA Elliptic Curve Digital Signature Algorithm may become invalid before Qday. In the worst-case scenario, it could take a few months rather than several years.

Drake believes that the industry should begin to plan a controlled migration, transferring assets to new addresses where the public keys have not yet been exposed, in order to reduce the amount of information that potential attackers can utilize.

But what is the basis for this warning of his? Is there really a need to panic?

Is the panic about encryption justified?

The concerns of Drake are not only about whether AI will accelerate the arrival of quantum computers and crack cryptography, but also about the possibility that the AI system could help to discover mathematical attacks based on classical computing that human cryptographers have overlooked.

He believes that elliptic curve cryptography, which underpins most blockchains, is more susceptible to such breakthroughs than hash functions, due to its more complex mathematical structure. This implies the possibility of a classical algorithm being able to crack elliptic curve cryptography.

Johns Hopkins University's professor of cryptography, Matthew Green, also expressed his views on the judgment of Drake, further intensifying the panic that has already permeated the crypto industry.

"I think we might lose public key cryptography."

Trezor Bitcoin analysts from hardware wallets Lucien Bourdon have the following to say about Magazine:

"Currently, there is no credible and publicly published progress that can crack the mathematics behind ECDSA, whether with the help of AI or other means."

He said that any AI generated mathematical papers recently released by OpenAI did not contain attacks on ECDSA – although Drake believes that this is more suspicious rather than reassuring. Another argument from Drake is that elliptic curves have more mathematical structure than hash functions, and therefore may be easier to crack.

"He didn't specify how to do it specifically." Bourdon said,"And he also referred to the timeline as the worst-case scenario, telling people not to rush."

The CEO and co-founder of the hardware wallet FoundationHQ, Zach Herbert, told Magazine that if the extended public key (xpub) has already been shared by the wallet application or third parties, then transferring funds to a new address may not be sufficient.

In this case,"They already have the information needed to derive the public key you want to hide."He said.

MetaMask, the founder and CEO, also pointed out that if cryptography truly fails, the price of your assets will no longer be your only concern:

Why simply moving coins might not be enough

Herbert indicates that xpub allows a wallet to generate multiple public keys for the same account, including those corresponding to addresses that have never been used.

If the wallet application or a third party already has this information, then transferring funds to a new address under the same account may not be able to hide the public key of the new address from the other party.

If ECDSA really becomes crackable in practice,"The attacker can then recover the corresponding private key without touching your hardware wallet."

StarkWare, Co-Founder and CEO; Eli Ben - Sasson told Magazine:

"No, this is clearly not sufficient to provide protection."

"Besides just moving your coins, if you want to continue using them in the future, you will need to download a new type of wallet."

He said that once a crack is found, it will not only affect wallet signatures. Ethereum's infrastructure-level signatures and consensus mechanisms also need to be addressed, and the Kate-Zaverucha-Goldberg ( KZG ) polynomial commitment schemes used in the data blob will also be affected.

Finally, the costs for Gas are also likely to increase significantly, as many functions will become ineffective.He added.

On Bitcoin, some address types hide the full public key through cryptographic hashing before the coin is spent. If the relevant hashing function remains secure, this can provide an additional layer of protection against attackers attempting to derive the private key from the public key. In contrast, Taproot addresses expose the public key directly on the blockchain.

Create a P2PKH public key hash to receive payments. Source: Bitcoin.org

Bourdon indicates that common SegWit addresses start with bc1q. Before a transaction is executed, the public key is hidden. On the other hand, wallets like Trezor generate new recipient addresses to reduce address reuse.

"There's nothing to do now,"He said, and added that panic-induced migration would only bring more harm than good.People who hastily transfer funds are prone to making mistakes, and scammers take advantage of such situations to approach them.

It is also worth noting that every time you spend Bitcoin, your public key is exposed within mempool, which provides an opportunity for attackers to exploit.

Not all crypto assets are the same.

Some blockchains are already preparing for cryptographic threats, although the solutions they propose vary.

On the NEAR Protocol that focuses on AI, users can add a quantum-safe FIPS-204 key to their existing mainnet account in a single transaction, without the need to migrate assets; wallets such as Meteor also support quantum-safe signatures. This relies on lattice-based cryptography, but Ethereum founder Vitalik Buterin is concerned that this approach may also be vulnerable.

Ethereum is developing a broader post-quantum roadmap that utilizes hash-based signatures and ZK proof-of-aggregation to cover all aspects from transaction signing to consensus and data security. It has also prepared a set of emergency hardfork and recovery proposals on paper.

In a post from March 2024, Vitalik Buterin outlined a potential hard fork solution: to roll back the blocks after the start of large-scale thefts, disable transactions from traditional wallets, and allow users to retrieve their funds using zero-knowledge proof seed phrases.

Bitwise Europe Senior Research Assistant Max Shannon stated that this is still just a proposal "without a clear timeline."

Although no one has yet demonstrated a feasible attack, he stated that users should shift towards quantum-safe signatures from a "long-term" perspective.

Hard fork in quantum emergency situations. Source: Eth Research

The account abstraction architecture of Starknet allows users to switch signature schemes without migrating their funds to a new address. Ben-Sasson indicates that the core technology does not need to be changed."Because account abstraction means that you can use any signature scheme."

However, he stated that other components still need attention, including the design of the network status tree and its dependence on Ethereum's security.

For users of Solana, switching to a new address does not help them, as their public keys will be exposed by default – however, they can migrate their funds to post-quantum vaults like Winter Wallet.

Solana Foundation, the Vice President of Technology, stated that if their signature scheme becomes crackable, Solana users will not need to enter "safe mode".

A single network upgrade can allow users to prove their ownership of secret seeds through hash-based proofs and migrate their accounts to a more secure signing scheme. He said that the proof-of-concept already exists, but the upgrade itself has not yet been deployed.

So, should holders of crypto assets panic after all?

Shannon indicates that Bitwise is not currently concerned about this theoretical risk, but "it is worth remaining cautious."

"We can discuss exposing the new address and xpub as a thought experiment."Herbert said,"But I won't pretend that these steps constitute a practical solution for that kind of scenario."

Since some people are still using old devices, have complex multi-signature arrangements, or hold Bitcoin that they haven't touched for many years, he stated that a single software update "will not automatically protect these coins."

Bourdon reminds crypto holders to carefully examine the source of information, as the warnings from Drake also mention Ethereum's recommended evolution towards hash-based cryptography.

“So, a warning about a threat that has not yet been confirmed also becomes a form of promotion for Ethereum’s roadmap.”He said.

This does not prove that Drake is wrong, but at present, there is still no evidence to suggest that ECDSA will be cracked soon, and there are also many risks associated with hastily transferring funds.

However, if the cryptography that supports encrypted wallets and blockchain truly fails, then moving coins might just be the easiest part of the response measures for the entire industry.