A not even public AI just cracked a government-grade cipher

The company announced on Monday that an unmatured model, Claude Mythos Preview, discovered a functional attack against HAWK, one of the final lattice-based signature schemes in the running for the position. The iteration took around 60 hours of AI research and about $100k worth of compute. It had gone unnoticed in two years of human review.

What We Broke, and What did not

HAWK-256 is a smaller test parameter NIST provides so that researchers can stress-test the design, not the version anyone would deploy. Fortunately for Mythos, HAWK's underlying lattice contained an unused pattern that dropped the target cost of a key-recovery attack from approximately 264 operations to 238, 67 million times lower. For comparison, code released by Anthropic itself recovers a HAWK-256 key in roughly three hours and 42 minutes on a 96-core server.

The versions anyone would realistically deploy, HAWK-512 and HAWK-1024, are unaffected: their attack cost only falls from 2^150 to 2^108, and from 2^288 to 2^182, still very computationally prohibitive. Along with it, Anthropic announced a second finding: that they achieved 200-800x speedup on an attack against seven-round AES, a research benchmark nobody had improved since 2013.

The problem is not the break itself, but it will sound kinda weird, well…

It's how it was found. Mythos read the literature, performed its own tests, and isolated the error working semi-autonomously within a research scaffold built on Claude Code. Anthropic claims it then verified Mythos completed its job correctly over hundreds of hours, which means the model found the bug more quickly than its own creators could verify.

As Anthropic put it plainly, this field is getting to the point where language models expose too many bugs for normal triage, verification and fix processes to keep pace.

The reason why bitcoin developers are still watching

Bitcoin never used HAWK. Its signatures use (of course) ECDSA and Schnorr over the secp256k1 curve, a completely different construction, so no wallet is impacted. However, Bitcoin's own post-quantum plan, BIP-360, is based on guidelines using ML-DSA and SLH-DSA, the exact two schemes which NIST finalized in 2024 due to them having received greater scrutiny than newer candidates such as HAWK. That decision looks better today than it did a week ago.

The unanswered question is whether the automated use of AI in cryptanalysis eventually produces anything useful with ML-DSA or SLH-DSA as well, and whether it does so before Bitcoin completely migrates from ECDSA.

The high price of waiting too long

According to estimates cited by TheStreet, there are approximately 6.7 million bitcoins worth nearly $600 billion contained in public keys of wallets that could potentially have their private keys revealed by a competent quantum computer first.

A different analysis, Quantum Horizon, gives a 1-in-6 chance of a sufficiently powerful code-breaking quantum computer existing by 2035, and estimates that if such an event were to happen before migration is complete then 2.3 million coins would be unrecoverable.

No one considers Bitcoin's cryptography to be broken as of this writing. What perhaps changed this week is confidence in how much runway remains to fix it before it breaks.

Ex-OpenAI researcher hedge fund bets against AI chip stocks

Situational Awareness, a hedge fund specializing in artificial intelligence that was established by Leopold Aschenbrenner, a previous employee of OpenAI, is seeking to get additional funding from investors as semiconductor and AI stocks plummeted. The timing is important because this hedge fund has the biggest disclosed bet against the companies causing the drop in the stock prices of semiconductor companies.

• In an unprecedented move, South Korea's stock market just collapsed -44% in 40 days, erasing -$2 trillion in market cap.

• Tokenized asset growth is exploding.

• A leaked Anthropic document just came out in court.

• US long-term borrowing costs are officially up to their highest level since 2007.

• American financial technology Block officially endorses passing the Clarity Act

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