Day two of the event focused on Quantum Computing, some of the progress and challenges. Good discussion on the state of hardware development, error correction and future use cases (esp medical and chemical/enviromental modelling).
Key Take Aways
- Quantum computing has significant potential for solving complex optimisation problems in financial services, particularly in portfolio management and risk analysis.
- Financial institutions are increasingly focusing on both offensive and defensive capabilities, preparing for the disruption quantum computing could bring to encryption and data security.
- Quantum communications and networking are gaining attention, with financial institutions exploring quantum-safe infrastructure.
- Long-term investment in quantum computing is seen as critical, even though benefits may take years to materialise.
- Banks are taking a pragmatic approach by identifying specific quantum computing use cases where tangible advantages can be realised, such as fraud detection and algorithmic trading.
- There is a shift in focus towards preparing for post-quantum cryptography to safeguard future data and systems.
- Quantum key distribution (QKD) combined with post-quantum cryptography (PQC) is being considered to create a robust quantum-safe infrastructure.
- Partnerships with universities and research centres are crucial for financial institutions to stay ahead of developments in quantum computing.
- Quantum computing could enable the modelling of highly complex systems with real-world constraints, unlocking opportunities in derivatives pricing and market simulations.
- Organisations are taking a risk-based approach to quantum, balancing investment and experimentation with the need to secure infrastructure.
- Workforce development and upskilling in quantum computing is seen as a strategic imperative to prepare for the future.
- Regulators and industry bodies play a critical role in driving the adoption of quantum-safe technologies and ensuring standards are in place.
Innovation
- The first internet-based quantum key distribution (QKD) connection by the Port of Rotterdam is a significant milestone in quantum communications.
- Exploration of quantum-inspired algorithms for optimisation problems in finance, such as portfolio optimisation and credit risk management.
- Collaboration between industry, academia, and governments to drive the development of post-quantum cryptography and quantum-safe networks.
Key Statistics
- HSBC has been working on its quantum programme for approximately 2.5 to 3 years.
- The Port of Rotterdam’s quantum communications initiative connects a large number of stakeholders via quantum key distribution.
Key Discussion Points
- The importance of protecting sensitive financial data against the future threat of quantum decryption.
- The need for financial services to upgrade cryptographic assets to ensure they are post-quantum secure.
- The role of quantum computing in providing a competitive edge through improved optimisation algorithms.
- The ongoing challenges of realising quantum advantage in practical financial applications.
- The significance of partnerships with research institutions to advance the understanding of quantum computing’s impact.
- The strategic imperative of addressing both the offensive (i.e., exploiting quantum for competitive advantage) and defensive (i.e., ensuring quantum-safe encryption) aspects of quantum.
- The potential for quantum computing to revolutionise fraud detection through more accurate modelling.
- The importance of long-term investment in quantum research, despite current technical limitations.
- The strategic role of workforce education and quantum talent development in financial institutions.
- The role of regulators in setting standards for quantum-safe infrastructure in finance.
- The potential for quantum computing to disrupt existing cybersecurity protocols and encryption standards.
- Quantum computing’s potential to transform algorithmic trading by providing faster and more accurate data analysis.
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