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International Conference on Next-Gen Quantum and Advanced Computing: Algorithms, Security, and Beyond (NQComp)

Development of Quantum-Ready Digital Wallet using Blockchain by Integrating Post- Quantum Cryptography, Dynamic Fees, and Proof-of-Work Consensus

Somya Jaiswal, Yogesh Pandya, Anshika Gangrade, Pratyush Patel, Jiya Darvai

Published Mar 5, 2026• 1 citation
Publisher

Abstract

The integration of blockchain technology with almost all sectors can bring positive transformation and a future influence on digital transactions. So far as the development of quantum computers has been achieved, it's necessary for blockchain security to explore quantum-resistant cryptographic techniques. This study inspects the production of a blockchain system with an adjustable transaction payment model, and introduces quantum resistant cryptography. Basically, the system attempts to compensate for the inherent security flaws in each of the conventional blockchains by authenticating and verifying transactions using Hash-based Message Authentication Code (HMAC)-based signatures, using conventional quantum-safe digital wallets. The project also looks at a dynamic fee setting to optimize transaction processing during periods of network congestion and a Proof-of-Work (PoW) consensus mechanism to lock the blockchain further. Finally, This paper would simulate the E91 quantum key distribution (QKD) protocol so as to examine the security features that are provided by the entanglement effects. Unlike the more commonly employed BB84 scoring system, the E91 scheme involves the discovery of eavesdropping through the breach of Bell inequality, and thus provides a unique approach to modular authentication of key swap in decentralized environment.

DOI
10.1109/nqcomp68334.2026.11497715

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The integration of blockchain technology with almost all sectors can bring positive transformation and a future influence on digital transactions. So far as the development of quantum computers has been achieved, it's necessary for blockchain security to explore quantum-resistant cryptographic techniques. This study inspects the production of a blockchain system with an adjustable transaction payment model, and introduces quantum resistant cryptography. Basically, the system attempts to compensate for the inherent security flaws in each of the conventional blockchains by authenticating and verifying transactions using Hash-based Message Authentication Code (HMAC)-based signatures, using conventional quantum-safe digital wallets. The project also looks at a dynamic fee setting to optimize transaction processing during periods of network congestion and a Proof-of-Work (PoW) consensus mechanism to lock the blockchain further. Finally, This paper would simulate the E91 quantum key distribution (QKD) protocol so as to examine the security features that are provided by the entanglement effects. Unlike the more commonly employed BB84 scoring system, the E91 scheme involves the discovery of eavesdropping through the breach of Bell inequality, and thus provides a unique approach to modular authentication of key swap in decentralized environment.
Quantum computing's development poses a significant threat to the cryptographic security of current blockchain technologies, potentially undermining the integrity of digital transactions. Quantum computers can break the complex mathematical problems that algorithms like RSA and ECC rely on, which could lead to vulnerabilities such as double-spending and fraud. To address these risks, the blockchain community is exploring quantum-resistant protocols that employ post-quantum cryptographic algorithms, which are designed to withstand quantum computing attacks. Quantum-secure blockchain protocols integrate quantum key distribution (QKD) and post-quantum cryptography (PQC) to enhance security. QKD uses quantum mechanics principles to secure communication channels, ensuring that any attempt to intercept the key introduces detectable anomalies. PQC involves algorithms like lattice-based, hash-based, or multivariate polynomial-based algorithms that are believed to be secure against quantum attacks. These protocols aim to maintain the confidentiality, integrity, and security of data transmitted over the blockchain, ensuring the longevity and reliability of blockchain systems in the face of evolving computational advancements. A quantum-secure blockchain scheme (QSB) utilizes a consensus mechanism, QPoA, and IQS. The QPoA is leveraged for block generation while the IQS is deployed in transaction verification1. Furthermore, the integration of quantum computing with blockchain can address current limitations, such as slow transaction speeds and lack of scalability, by optimizing calculations and enabling smarter, more sophisticated smart contracts. The development and implementation of quantum-resistant blockchains are essential for future-proofing digital transactions and maintaining trust in decentralized systems
The concept of blockchain technology has transformed the digital ecosystem to allow decentralized, transparent and immutable transactions in various sectors. Its security is closely dependent on classical cryptography like ECDSA and RSA to perform digital signatures and SHA-256 to achieve consensus, which are becoming more susceptible to quantum computing. The cryptographic principles underpinning blockchain could be compromised with the emergence of the quantum algorithms of Shor and Grover, endangering the integrity of transactions, authentication and consensus protocols. This paper discusses the implications that quantum computing could have on blockchain security, analyses vulnerabilities of current cryptographic primitives and assesses post-quantum cryptographic (PQC) protocols, including lattice-based protocols, hash-based protocols, and code-based protocols. To guarantee backwards compatibility, as well as a gradual upgrade process to quantum-resistant protocols, a hybrid migration approach that involves transactions with two signatures is suggested. Experimental analysis shows that PQC integration attains reasonable performance trade-offs, that preserve verification costs, block size growth, and throughput effects within feasible limits, and that zero-loss resilience is achieved during reorganization tests. The conclusion is that blockchains with PQC support can reach post-quantum levels of security without major operation interruption, and they provide a viable roadmap to moving towards distributed ledger systems that are future-ready.
Objectives . The aim of this work is to develop and implement a conceptual model of a quantum-secured blockchain by integrating a quantum key distribution mechanism based on the E91 protocol into a classical architecture. Methods . The vulnerabilities of classical blockchain cryptographic mechanisms to threats posed by quantum computing are considered. To create a resilient architecture, it is proposed to combine the properties of quantum entanglement with classical cryptographic methods. The E91 quantum key distribution protocol, based on quantum entanglement and the Bell inequality test (CHSH test), is used as the foundation. A new field, E91 MAC, is introduced to link blocks in the chain, calculated using the HMAC algorithm from the hash of the previous block with a key generated by the E91 protocol. The Delegated Proof of Stake (DPoS) algorithm is chosen as the consensus mechanism. The software implementation includes simulating the E91 protocol using the IBM Quantum cloud platform and the Qiskit library, as well as deploying a peer-to-peer blockchain network with a CLI interface in Python using TCP sockets. Results . A conceptual model was developed and a prototype of a quantum-secured blockchain was implemented. A functional peer-to-peer network with the DPoS consensus algorithm and a distributed voting mechanism was created. The successful simulation of the E91 protocol confirmed the possibility of generating and verifying a quantum key. The fundamental feasibility of integrating a quantum authentication mechanism (E91 MAC) into the block creation and validation process was demonstrated. Conclusion . The proposed hybrid architecture demonstrates a novel approach to blockchain security, based not only on computational complexity but also on the fundamental laws of quantum mechanics. The integration of the E91 protocol and the DPoS mechanism provides potential resilience to quantum attacks and high network energy efficiency. The software prototype confirms the practical feasibility of the concept for creating secure next-generation distributed ledgers.
The arrival of quantum computing poses a huge threat to conventional public key cryptography used in blockchain systems such as Bitcoin. To address this challenge, we proposes and evaluates a quantum resistant sidechain framework that integrates post quantum digital signature schemes and quantum key distribution (QKD) protocols with the Bitcoin mainchain. Using a Python simulation environment, the performance of multiple signature algorithms. ECDSA as a baseline measurement, Falcon, CRYSTALS-Dilithium, and SPHINCS+ were analyzed in combination with quantum communication protocols BB84, E91, and SARG04. Experimental results show that ECDSA remains the fastest baseline scheme but lacks quantum resistance, while SPHINCS+ provides the highest security with an expected overhead of 93.5 %. Among quantum protocols, BB84 achieved the best overall efficiency across transaction sizes. The optimal integration pairs were BB84 and CRYSTALS-Dilithium combination for speed, security balance and SPHINCS+ and E91 for maximum quantum resilience. These findings demonstrate the practical feasibility of deploying post quantum cryptographic components in Bitcoin compatible sidechains, paving the way for future blockchain networks that remain secure in the post quantum era.
The fast growth of quantum computing makes the old modes of cryptography, be it RSA or ECC, weak to quantum attacks, especially when it employs Shor's algorithm. Threatening also builds up on the post-quantum age regarding blockchain technology and its external cryptography, which secures reliable transactions and authentication. This study will address the importance of quantum resistant blockchain authentication protocols for the security of decentralized systems against any forward-looking quantum-enabled attacks. This paper goes through different classifications of post-quantum cryptography like lattice-based, hash-based, multivariate polynomial, and code-based cryptography, taking an effort to analyze their compatibility with blockchain use cases.[8] Moreover, we also introduce the innovative quantum-resistant authentication model designed to enhance security while not compromising upon efficiency.[2] [3] Our proposed model would ensure scalability and less computational overhead by partially providing immunity to quantum adversaries through its underlying use of post-quantum signature schemes and lightweight key exchange mechanisms. This research aims at laying the foundation for developing a secure blockchain ecosystem against quantum threats, heading toward a resistant future-proof decentralized infrastructure. [4] [5]
The advent of quantum computing threatens the cryptographic security of traditional blockchain systems, potentially rendering current encryption techniques obsolete. This paper explores quantum-resistant blockchain protocols that leverage post-quantum cryptographic algorithms to ensure secure transactions. We analyze various quantum-safe cryptographic methods, such as lattice-based, hash-based, and multivariate polynomial cryptography, evaluating their feasibility for blockchain applications. Through comparative analysis, we discuss their computational efficiency and security guarantees. Our findings suggest that integrating quantum-resistant cryptographic techniques into blockchain frameworks is essential for future-proofing decentralized systems. This paper explores the integration of quantum-resistant cryptographic algorithms within blockchain technology. The proposed approach utilizes CRYSTALS-Dilithium for digital signatures, ensuring secure transaction verification in a post-quantum era. While Kyber is a robust key exchange mechanism, it is not suitable for signing transactions. The implementation is tested on standard hardware, demonstrating feasibility without requiring specialized quantum computing infrastructure.