The world is on the cusp of a quantum revolution and the impact of what quantum computing can bring, particularly to financial services, is enormous, writes Philip Intallura, global head of Quantum Technologies at HSBC. Currently, there is a lot of debate around exactly when this might happen – some see quantum as a far-off dream, but the technology is evolving at a tremendous pace.
“When experts and organizations can demonstrate a commercially useful quantum advantage, and people can relate to something meaningful that will impact them or their business, I think we’ll see this huge shift,” he wrote. “People will start to embrace the idea as they have with artificial intelligence (AI) and generative AI, such as ChatGPT, more recently. I think quantum computing’s ‘ChatGPT moment’ will come sooner than many anticipate.”
He added that quantum computing will have a huge commercial and customer impact as “we’ll be able to calculate things we can’t today.” The types of problems a quantum computer can solve are closely matched to the types of models the bank runs every day. Examples include machine learning for fraud detection, financial simulation models for risk and portfolio optimization.
Quantum threat
The malicious use of quantum computing also poses a threat. In the next 10-20 years it’s expected the technology will break through the encryption currently used across the banking industry – but this could happen earlier.
“It’s not just a case of waiting for quantum computers to arrive. We must prepare for the opportunities but also address the security threat. We absolutely have to start looking at both now,” he wrote.
The threat to cybersecurity that quantum computers pose will be a problem for everyone, but it’s particularly a problem for financial services where the business model is predicated on protecting and processing billions of transactions worth trillions of dollars a year.
To protect ourselves HSBC is exploring two technologies immune to the attacks by quantum computers: Post-Quantum Cryptography – which is math based – and Quantum Communications – which is physics based.
Secure communications
Quantum key distribution (QKD) uses quantum physics to deliver secret keys between parties that can then be used to encrypt and decrypt sensitive data. They are safe from eavesdroppers or cyberattacks by quantum computers. QKD uses quantum physics to deliver secret keys between parties that can then be used to encrypt and decrypt sensitive data. They are safe from eavesdroppers or cyberattacks by quantum computers.
HSBC was first bank to join BT and Toshiba’s pioneering quantum-secured metro network, which connects its global headquarters at 8CS in London to the data center in Berkshire, UK. In addition, earlier this year, in a world-first trial, HSBC became the first bank to trial quantum protection for AI-powered foreign exchange trading.