Morning Minute: Claude Mythos Breaks Post-Quantum Cryptography

Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt.

GM!

Today’s top news:

• Crypto majors are green ahead of FOMC; BTC +1.6% at $64.4k
• BlackRock joins Fidelity and Goldman in support of the Clarity Act
• Anthropic says Mythos broke post-quantum cryptography
• Zcash activated its Ironwood upgrade, 3.8% migrated out of Orchard so far
• New Robinhood meme PIPEDOG soars to $40M+ on massive volume

🔓 An AI Model Just Broke Post-Quantum Cryptography

Anthropic said an unreleased version of its most powerful model, Claude Mythos Preview, found two previously unknown attacks on crypto algorithms, one of them against a scheme competing to become a U.S. federal standard.

The target, HAWK, is a digital signature system that proves a transaction came from you without exposing your private key, and it was specifically designed to survive quantum computers. NIST had advanced it to the third round of its post-quantum competition in May, where it was the last lattice-based candidate standing. Claude found a symmetry in HAWK’s math that no human had used, dropping the cost of stealing its smallest key from 2^64 operations to 2^38, roughly 67 million times less work.

Patching HAWK means roughly doubling its key sizes, and as Anthropic put it, that “eliminates many of the reasons” HAWK was attractive in the first place. Signature size is block space, and block space is fees, so any chain shopping for a quantum-resistant replacement is partly choosing on bytes per signature. Compact keys and fast signing were HAWK’s entire pitch, and the fix reduces that edge.

To be clear for crypto holders: HAWK has never been deployed anywhere, and Bitcoin still runs on ECDSA, the pre-quantum scheme these candidates are eventually meant to replace. So nothing in the field is broken. But that’s not the problem.

The problem is that post-quantum security remains the biggest overhang for crypto. The entire quantum defense effort spun up over the past weeks and months (the BlackRock-Coinbase-Strategy consortium, Vitalik’s post-quantum roadmap, NEAR and Zcash roadmaps, etc.) rests on the assumption that the post-quantum schemes replacing today’s cryptography are themselves sound. Claude Mythos just poked a hole in a leading candidate before it ever shipped.

The good news is the same tool defends as well as it attacks, which is exactly why the industry is racing to point it at its own code first. Now we find out whether AI breaks cryptography faster than it can help rebuild it.

🌎 Macro Crypto and Markets

• Crypto majors are green and rebounding ahead of FOMC; BTC +2% at $64.4k; ETH +2% at $1,910; SOL +1% at $74; HYPE +1% at $54.90
• Top alt movers include Kaito (+10%), JUP (+8%) and UNI (+7%)
• Oil +4% at $83; Gold even at $4,030
• Stock futures are mixed ahead of FOMC today; DOW -0.3%, Nasdaq +0.3%
• BlackRock, Fidelity, and other Wall Street giants publicly backed the CLARITY Act, with BlackRock, Fidelity, Franklin Templeton, Goldman Sachs, and SoFi all urging passage, even as JPMorgan splits from the group over stablecoin-yield rules and the Senate’s window shrinks
• Wall Street veteran Don Wilson said regulators are getting perps all wrong, arguing that crypto’s biggest trading innovation, perpetual futures, is being misunderstood by the CFTC and CME as they fight over onchain oversight
• Ondo dropped its tokenized-asset blockchain plans in favor of a private, high-speed trading network, a notable pivot for one of the biggest names in real-world-asset tokenization
• Ethereum startup EthSystems is betting privacy is the key to getting banks onchain, building tools so institutions can use public blockchains without exposing their activity
• Michael Saylor called Bitcoin’s code “a constitution,” arguing that changes like BIP-110 are attacks on “economic rights”
• Morgan Stanley launched spot Ethereum and Solana ETPs under tickers MSSE and MSOL, each staking a portion of holdings and passing rewards to investors
• 1inch launched its Aqua shared-liquidity layer publicly on 13 chains, letting LPs keep tokens in their own wallets while backing several positions at once, in what it calls the first “risk-controlled” DeFi liquidity venue
• Russia charged Telegram founder Pavel Durov with aiding terrorism and placed him on an international wanted list, with the FSB alleging Telegram won’t remove channels used to coordinate attacks inside Russia

Corporate Treasuries & ETFs

Meme Coin Tracker

• Meme leaders were mixed; DOGE +1%, SHIB +3%, PEPE -2%, PENGU even, TRUMP -3%, BONK +1%
• Robinhood chain was led by PIPEDOG which saw $66M and ran to $45M mc; Cashcat (+22%), Stonkbroker (+70%) and AI (+16%) were other movers
• The Cashcat team announced a new launchpad in letscash dot fun which uses fees to buy and burn cashcat tokens
• Solana leaders included frank (+44x), Jimothy (+110%) and Untie (+150%); ANSEM +10% at $180M, EPIK +10% to $14M

💰 Token, Airdrop & Protocol Tracker

🚚 What is happening in NFTs?

• NFT leaders were mostly flat; Punks -1% at 32.3 ETH, BAYC -1% at 8.35 ETH, Pudgy even at 4.06 ETH; Hypurr’s +1% at 189 HYPE
• StonkBrokers (+50% to 3 ETH) and Satari (+26%) led top movers; TTT +20%
• FWA rebounded 23% to $21M overnight after dipping as low as $14M; the protocol added several new ERC20s including MOG and REKT