The Potomac Officers Club on Thursday hosted its first Digital Currency and National Security Forum, which gathered the leading figures and voices in the blockchain, cryptocurrency and virtual asset movement to explore the underlying technology foundations, the national security concerns and the potential future impacts of digital currencies as the topic continues to take the global spotlight in governments and industries worldwide.
Following an opening keynote from National Cyber Director Chris Inglis, an inductee into Executive Mosaic’s Wash100 for 2022, the program proceeded to an expert panel discussion featuring Unchained Capital’s Dhruv Bansal, Google Cloud’s Daniel Prieto and Eddy Zervigon of Quantum Xchange on integrating zero trust architecture into digital currency.
Gregg Garrett, Peraton’s vice president of cybersecurity, kicked off the productive discussion with a brief lesson on some of the major figures, concepts and terms surrounding the digital currency conversation. After giving the virtual audience critical context for the impending conversation, Garrett asked the panelists to weigh in on the timely topic.
To hear the full panel discussion, visit PotomacOfficersClub.com, where you can watch the full Digital Currency and National Security Forum on-demand now.
The audience first heard from Daniel Prieto, head of cybersecurity strategy for Google Cloud’s public sector, who gave an overview of the complex challenges facing federal and industry leaders today in the area of cybersecurity as it relates to digital currency.
Prieto noted that though primary concern was initially placed on espionage and data theft, organizations are now shifting focus to areas like data destruction, data manipulation and quantum as adversarial threats emerge and evolve.
“We know how essential things like timestamps are to the veracity and reliability of underlying financial systems,” Prieto commented. “We’ve seen rapid development of custom developed malware, and in terms of the actual technical exploits, real increases in the agility scale of credential stealing capabilities and software, remote access control and generalized information theft.”
He added that this threat environment is “high risk” for the public sector and the financial sector and must be addressed.
Eddy Zervigon, CEO of Quantum Xchange, joined the conversation to highlight the necessity for strong security foundations as digital currencies continue to experience a growing number of illicit transactions and increased threats from adversarial forces.
He said that while any compromise of a bank’s IT infrastructure would pose urgent problems, the ledger system baked into digital currency technologies and operations pose even more significant vulnerabilities to financial institutions.
“In particular, the ledger system used to protect cryptocurrencies, whether it’s centralized or decentralized, is vulnerable because the ledger depends entirely on public key infrastructure for encryption signature and hashing,” Zervigon stated.
Additionally, Zervigon warned that although our ability to encrypt has mitigated past decryption challenges, the developments unfolding in quantum computing threaten to break down historically successful security measures.
“We’re about to undertake the largest cryptographic migration in our history, so we better get the foundations right,” he said.
Then, Dhruv Bansal, co-founder of Unchained Capital, offered his thoughts and concerns surrounding the centralization of virtual assets that were built to be decentralized, like Bitcoin, and the key differences between cryptocurrencies and central bank digital currencies.
“Some of the things that make Bitcoin exciting are that there is nobody in charge, there’s no leader, it’s very private, the issuance schedule is fixed,” Bansal outlined. However, he noted, “These are not necessarily the goals of a central bank digital currency.”
“So I sometimes question the wisdom of adopting a technology implementation which was designed for this completely public peer-to-peer distributed model and trying to adapt it to a model that has distinct goals,” Bansal shared.
Bitcoin’s strengths, Bansal explained, lie in its distributed nature and its “complex and robust gain theoretic balance” between all figures involved, from users to miners and every role in between. But the relationship is delicate and could pose issues if disturbed.
“The danger is that one of those parties becomes too strong relative to the others, and we get some kind of centralization,” he said.
You can view the full expert discussion from the Digital Currency and National Security Forum on-demand now at PotomacOfficersClub.com.
The platform’s next event, Achieve Information Dominance: Counter Gray Zone Warfare Through Unifying Data, takes place on Feb. 2.
Brig. Gen Charles Parker, deputy director of J6/Joint Staff and chair of the Department of Defense’s Joint All-Domain Command & Control Cross Functional Team, will keynote the event to share his military expertise on data unification as a JADC2 component.
Register now for the Potomac Officers Club’s next JADC2 Series event, Achieve Information Dominance: Counter Gray Zone Warfare Through Unifying Data.