The report, “Hashing Out the Future of Encryption Algorithms: Innovations Driving Startup Growth in Cryptography,” predicts the commercialization of encryption technology, namely that derived from the FIDO2 standard, will gain mainstream adoption by 2025.
According to the FIDO Alliance, the standard uses public-key cryptography generally considered more secure than traditional password authentication. Pitchbook notes passwords are being replaced at a brisk pace as 60% of enterprises included in the study reported adopting some form of “passwordless multifactor authentication.”
“FIDO2 enables users to leverage common devices to easily authenticate to online services in both mobile and desktop environments,” the alliance says. “The FIDO2 specifications are the World Wide Web Consortium’s Web Authentication specification and FIDO Alliance’s corresponding Client-to-Authenticator Protocol.”
Pitchbook analysts note innovation in this space has historically led to the creation of larger companies, and that is still expected in the coming years. For example, Transmit Security was able to secure a patent in 2014 for a private authentication key and successfully scaled that business into a $2.7 billion valuation enterprise.
However, Pitchbook experts also anticipate these developments will spawn smaller companies as well, which will be aimed, similarly, at monetizing the most enticing elements of encryption tech. “While incumbents are developing products in these spaces, our information security analyst believes that startups will ultimately be formed to commercialize the most advanced breakthroughs from academia and as spin-offs from large companies,” reads the Pitchbook report.
From Twitter
"Encryption is the foundation of modern secure digital communications and storage. Time required for breaking encryption is measured in 1000s of years by binary based computing. Quantum computers can break current encryptions in seconds. Imagine how they can be used 4 good or evil"
Additionally, the report also addresses more in-depth encryption practices like “privacy-enhanced computing” that are expected to take a little longer to develop and commercialize. Research and adoption here, notes the report, could linger to the end of the decade.
One such element of privacy-enhanced computing specifically mentioned is “homomorphic encryption,” which is identified by Pitchbook as the “holy grail” of the encryption space. “The protocol allows third parties to operate on encrypted data, thus removing the need to manage encryption keys, which is a vulnerability in data security platforms. However, the products suffer in practice from excessive compute requirements, and they are ill suited to large databases given the processing power requirements,” reads the report.
From Twitter
Michael Sheetz @thesheetztweetz
Northrop Grumman completed a ground demonstration of the crosslinks needed for communications in the Pentagon's T1TL mesh satellite constellation, supplied by Mynaric $MYNA laser communications and Innoflight for encryption: https://news.northropgrumman. com/news/releases/northrop-grumman-announces-successful-laser-communication-demonstration-for-tranche-1-transport-layer-prototype-constellation
