CAIA: quantum computing will mess up all expectations

Advances in quantum computing could be a disruptive development for just about every business with an IT department, writes the Chartered Alternative Investment Analyst (CAIA) Association. Among much else, quantum supremacy (the situation when quantum computers solve problems that classical computers can’t) will redefine investment and trading, and what counts as “alternative” in either context.

Unplanned obsolescence

The core technical foundation digital assets were built on (i.e., the tech that makes them secure) was developed in a computing paradigm that may be turned on its head by QC. The absolute faith that most technologists have in digital asset security (the impossibility of altering the block, the computational cost of [cryptocurrency] mining, etc.) is all based on the current paradigm of what computers can reasonably do now, and in the future, based on everything we know about physics and computational evolution.  Quantum computing throws all that out the window.

Meanwhile, quantum computing can reasonably be expected to enhance high-frequency trading, bundling a latency shrinkage with AI and predictive capacities. It will make possible leap in the tailoring of services to particular customers, insurance contracts, mortgages, and portfolio allocations among them; and it will make Monte Carlo simulations easier and faster—again, a difference of degree that can become a difference in kind.

A new ecosystem

Google, for example, is mainly interested in developing the platform, and so to speak developing “quantum computing as a service.” But this is just part of a full ecosystem that is developing. There are startups that are interested in building applications on this platform, and there are investment funds especially interested in finding the entrepreneurs with promising ideas for quantum apps and investing in them.

Darin Cag, an alum of the Said Business School, Oxford University, and the founder of Richtopia, speculates that quantum computing will be harnessed to blockchain techniques and that together they will represent a hack-proofing of the Internet of Things. But he cautions that until that is worked out, quantum computing poses “a major threat to existing infrastructures, including blockchain.”

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