Interesting... so what's the purpose ? Why are they burning ?

Every year some people lose their keys, so it is obvious total number of bitcoins will decrease every year.

Care to explain how could integer factorization algorithm apply to the cryptanalysis of Merkle-Damagard hash functions?

Initialize hash values:
(first 32 bits of the fractional parts of the square roots of the first 8 primes 2..19):
h0 := 0x6a09e667
h1 := 0xbb67ae85
h2 := 0x3c6ef372
h3 := 0xa54ff53a
h4 := 0x510e527f
h5 := 0x9b05688c
h6 := 0x1f83d9ab
h7 := 0x5be0cd19

Initialize array of round constants:
(first 32 bits of the fractional parts of the cube roots of the first 64 primes 2..311):
k[0..63] :=
   0x428a2f98, 0x71374491, 0xb5c0fbcf, 0xe9b5dba5, 0x3956c25b, 0x59f111f1, 0x923f82a4, 0xab1c5ed5,
   0xd807aa98, 0x12835b01, 0x243185be, 0x550c7dc3, 0x72be5d74, 0x80deb1fe, 0x9bdc06a7, 0xc19bf174,
   0xe49b69c1, 0xefbe4786, 0x0fc19dc6, 0x240ca1cc, 0x2de92c6f, 0x4a7484aa, 0x5cb0a9dc, 0x76f988da,
   0x983e5152, 0xa831c66d, 0xb00327c8, 0xbf597fc7, 0xc6e00bf3, 0xd5a79147, 0x06ca6351, 0x14292967,
   0x27b70a85, 0x2e1b2138, 0x4d2c6dfc, 0x53380d13, 0x650a7354, 0x766a0abb, 0x81c2c92e, 0x92722c85,
   0xa2bfe8a1, 0xa81a664b, 0xc24b8b70, 0xc76c51a3, 0xd192e819, 0xd6990624, 0xf40e3585, 0x106aa070,
   0x19a4c116, 0x1e376c08, 0x2748774c, 0x34b0bcb5, 0x391c0cb3, 0x4ed8aa4a, 0x5b9cca4f, 0x682e6ff3,
   0x748f82ee, 0x78a5636f, 0x84c87814, 0x8cc70208, 0x90befffa, 0xa4506ceb, 0xbef9a3f7, 0xc67178f2

b. hiding your crypto source code is OF COURSE making it stronger.

It's easy to use hashes for encoding.

The decoding step, on the other hand, is a bit lossy...

I think the NSA created bitcoin... and they created SHA256

As an ex IBM Research guy, this sounds like a product of the IBM Research PR dept. They are really good.  However, maybe some of you can answer the following dumb questions.
 
1.       I thought the quandary of practical implementation of high Qubit computers was that the Qubits all had to communicate with their environment (that is, other Qubits), without communicating with their environment (the thermal sea of other interacting  fluctuations leading to quantum decoherence).  Does this IBM advance in what seems like ECC resolve this quandary?
2.       The press release says:” Once a quantum computer is perfected it will not only be able to crack any encryption code today and make new uncrackable codes..”
I thought that Schorrs algorithm showed an approach to factoring giant numbers into prime numbers in polynomial time on quantum computers caused concern about the current approach to asymmetric codes (public/private keys that are really important), but   other approaches to asymmetric code(someone on this list  mentioned knapsack) and also transpositional (hash) codes (Bitcoin for infamous example)  had no known algorithm for solving in polynomial time on quantum computers, so describing this advance as  cracking any encryption code is overstated. .So, is the press release overstated on cracking any encryption code today.?
3.     Is it proven that quantum computers can’t solve transpositional codes or other codes (besides factoring primes) in polynomial time, or could it just be we haven’t discovered the algorithm?

Hi Bob,

I don't have time right now to give a larger rundown, but:

1. Quantum Error Correction is a very well-researched field. See
Devitt's "QEC for beginners" paper, if you're interested:
http://arxiv.org/abs/0905.2794
Yes, you have the general characterization of the problem right -- you
want qubits that are easy to control but don't interact with the
environment, and those two characteristics are contradictory.
2. I'm actually not aware of any research on using quantum computers
to make better encryption schemes. The usual problem is that they have
confused quantum key distribution (QKD) with quantum computing, and
QKD doesn't exactly solve the problems created by Shor's algorithm.
Shor will impact authentication mechanisms, breaking RSA and friends,
but QKD in fact *still depends on authentication*, so it's not a fix.
As to other specific encryption algorithms, I'm not up on the details,
but there is an irregular series of conferences on post-quantum
cryptography, and I think the next one is here in Japan:
http://pqcrypto.org/
3. Same as above, don't know.

As systems people, a good place for you to start might be my CACM
article from 2013:
http://cacm.acm.org/magazines/2013/10/168172-a-blueprint-for-building-a-quantum-computer/fulltext
it should be open access, you shouldn't need an ACM membership to fetch it.

If you are interested in networks, in particular, in fact last year I
published a book on quantum repeater networks. My apologies for the
price, that wasn't my decision:
http://eu.wiley.com/WileyCDA/WileyTitle/productCd-1848215371.html

I was asked by someone else about the specific numbers in the press
release. Sorry, my answer is kind of technical and relates to the
surface code form of error correction, but:

Are these 8,13,17,49 some kind of magic numbers ?

I?m not sure where the 8 comes from (other than that?s what they think
they can make), but the 13 and 17 very likely come from Clare?s
lattice surgery paper:
http://iopscience.iop.org/1367-2630/14/12/123011/article;jsessionid=B9EB904155288C40375C2DEE81165F77.c2

17 is enough to demonstrate distance 3 (d=3) surface code qubit,
including all of the stabilizer syndrome qubits. If you reuse some of
the syndrome qubits, you can do it with 13 physical qubits instead,
but then you have to wait longer for one cycle of QEC, so it?s only a
win if your memory is high fidelity. At distance 3, you can *really,
truly* correct *any* single error that occurs on your qubits.

I?m not sure where the 49 comes from. Shota, is 49 the right number
for some larger lattice?

53 is the number you really want ? arrange them as in Fig. 18 in
Clare's paper, and you can do a CNOT between two d=3 logical qubits,
and you would have the world?s first true, error protected quantum
*computation*. I would guess that 53 is the number that both Google
and IBM are really shooting for in the next five years or less...

So the IBM work is a very big advance. The PR is even better.

--Rod

btw, one of the big reasons that quantum error correction is hard is
that extracting syndromes requires touching the qubits. We are
accustomed to thinking about error correction as something that is
done after the error channel itself, e.g. after transmission or
reading from a disk, and that the error correction process itself
doesn't introduce errors beyond the mathematical limitations. But
imagine if the circuit that calculates your syndromes itself has an
error rate of several percent and might accidentally overwrite even
the already error-prone data you are trying to correct. That's what
it's like in quantum.

In the research literature, you sometimes read papers that say that
errors can be corrected up to about 10%, or even 50% in some cases,
but those are hypothetical systems in which the extraction of
syndromes is perfect -- very far from the real world.

--Rod

... and what would that have to with a back-doored sha256?

Ultimately it's a moot point

Well, how is that different from saying "Roll your own currency = recipe for total disaster"?

An algo designed by Bitcoin Engineering Task Force specifically for bitcoin. Then and only then bitcoin has a chance to be safe. Bitcoin should not use hashing algo because it is recommended by NIST or NSA or whatever. On the contrary, other organizations should use whatever bitcoin network uses because if it is broken bitcoin will act as honey-pot and will inevitably expose the weakness!

Which one? Give a concrete answer.

I expected that answer.

My opinion is other than that.

What is your opinion, derived from the thread you link to? Do you believe the thread points to bit coin being secure?

What makes you think that, even if that were the case, it would matter at all?

Bitcoin is open source, and clearly documented, and everybody can verify that it does what it's supposed to do, and cannot be controlled by the maker or anyone else.
Whoever made Bitcoin, or why, is completely irrelevant.

And by the way, I still see a lot of people in this thread talking about the NSA (or China or quantum computers or anyone) decrypting stuff, or 'breaking encryption'. Get a grip, people. THERE IS NO ENCRYPTION IN BITCOIN WHATSOEVER. So there's nothing to decrypt to begin with.