Public-key birthday: ‘Cypherpunk sacred text’ turns 49 today

The gap between cryptography breakthroughs is shortening

article-image

Richard Diffie and Martin Hellman | Mary Holzer and Matt Crypto/"Diffie and Hellman.jpg" (CC license), the Diffie-Hellman paper, and Yurchanka Siarhei/Shutterstock and Adobe modified by Blockworks

share

This is a segment from the Supply Shock newsletter. To read full editions, subscribe.


It took nearly seven centuries for a cryptography breakthrough to sunset the Caesar cipher that was big in the first century BC.

Caesar ciphers simply shifted letters up or down in the alphabet by a fixed number of positions. Starting in the year 800, Arab polymath al-Kindi began working on what’s known as frequency analysis — a type of systematic pattern recognition that would result in reverse-engineering shift cipher encryption, like the Caesar.

By the 16th-century Renaissance, solving Caesar ciphers was so easy that they were considered children’s puzzles.

So it was until two cryptographers, Italian Giovan Battista Bellaso and French Blaise de Vigenère, discovered and popularized the so-called Vigenère cipher, which incorporated multiple cipher alphabets derived from a single keyword.

The Vigenère cipher was a revolution in information privacy. The poly-alphabetic method was believed unbreakable and even named the “indecipherable cipher.” 

Three hundred years would pass before, in the mid-19th century, two others independently cracked the system. 

Charles Babbage, a revered grandfather of computer science, and military man Friedrich Kasiski, unknown to each other, had separately rendered Vigenères entirely obsolete, even before the arrival of computers.

So, that makes for a 700-year gap between Caesar and al-Kindi, and a 300-year gap between Bellaso-Vigenère and Babbage-Kasiski.

A cypherpunk breakthrough

On this exact day in 1976 — 49 years ago and more than a century after Babbage and Kasiski cracked Vigenère — a pair of American academics presented their own revolution: the concept of public key cryptography, which today underpins Bitcoin and most modern communication technologies.

Building off the novel work of computer scientist Ralph Merkle, the duo of Richard Diffie and Martin Hellman had devised a way to achieve what was, once again, considered theoretically impossible: enabling secure communication without a secret key shared between the two parties.

The method was outlined in their paper, New Directions in Cryptography, which WIRED would later describe as “a cypherpunk sacred text.”

“We stand today on the brink of a revolution in cryptography,” Diffie and Hellman wrote. “The development of cheap digital hardware has freed it from the design limitations of mechanical computing and brought the cost of high grade cryptographic devices down to where they can be used in such commercial applications as remote cash dispensers and computer terminals.”

“… At the same time, theoretical developments in information theory and computer science show promise of providing provably secure cryptosystems, changing this ancient art into a science.”

Diffie-Hellman’s paper would be adapted into RSA encryption within two years, itself a touchy cornerstone of the Crypto Wars that directly followed. 

Amazingly, as WIRED documented, another cryptographer, British intelligence officer James Ellis, had proposed a public-key system years before the Diffie-Hellman paper. But Ellis’ work was never permitted to see the light of day, a factoid that makes the conclusion of Diffie and Hellman’s foundational work so much more poignant: 

“We hope this will inspire others to work in this fascinating area in which participation has been discouraged in the recent past by a nearly total government monopoly.” 

And while specific or weak forms of public-key encryption have been broken over the years, it remains unbroken at a theoretical level.

Now, (almost) half a century on from cryptography’s last great breakthrough, all eyes are on the arrival of practical quantum computing — whenever that may be.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template (10).png

Research

Innovations on Aptos’ technical design through Raptr, Shardines, and Zaptos approach near-optimal latency and throughput by unlocking 100% utilization of network resources, with the capacity to settle 260k transactions per second with latencies less than 800ms. The original Move language was revamped with the launch of Move 2, supporting more expressivity in smart contract logic and a scalable ability to interact with high volume datasets. The ecosystem has benefitted from strong asset inflows, now hosting over $1.3B in stablecoins, $450M in bridged BTC, and $530M in RWAs. Activity in the Aptos ecosystem has grown notably over the past year, with monthly application revenue reaching ~$835k and monthly DEX volumes growing to over $5B, both at new all time highs.

article-image

Sam Altman sees our future through the World Orb

article-image

Few US politicians are this clearheaded about Bitcoin

article-image

Pump.fun seemed to kick off buybacks on Tuesday according to onchain analysis

article-image

Stablecoins are a new form of money, with an old kind of limit

article-image

Firedancer has yet to go fully live, but its progress has been “pretty impressive,” a dev said

article-image

House lawmakers support, criticize the GENIUS Act, CLARITY Act and the Anti-CBDC Surveillance Act in Monday hearing