Financial Companies Are Seeking The Advantage Of Algorithms Inspired By Quantum Computing

In 1994, Peter Shor, a mathematician, presented an algorithm for quantum computing. With this algorithm, the time it takes to find the prime factors of huge numbers is greatly reduced. Conventional transistor-based computers theoretically needed billions of years, which can be reduced to a few days with quantum computing.

A real revolution, because the decomposition into prime factors is the basis for a large part of today's encryption and IT security infrastructure. Seven years later, in 2001, IBM scientists demonstrated the algorithm for the first time with great success - albeit on a small quantum computer. They proved that quantum computers can be built and that Peter Shor's mathematical algorithm can be implemented.

Banking And Financial Sector.

Optimizing algorithms can also benefit sub-sectors of financial companies in many other sectors, such as the crypto market; where prime factorization is the basis of much of today's global web of security and privacy infrastructures.

Bank balances, credit cards, social media passwords, crypto exchanges with relevant information and data about bitcoin, blockchain or just where buying Dogecoin is profitable for investors - pretty much everything that cybercriminals care about would be better protected by quantum computing; through encryption systems that a classic computer could not crack with brute force.

On the other hand, there is also a risk here; namely when this technology is in the wrong hands.

The risk in quantum computing

Quantum computing could overturn this paradigm and make it easier to bypass the encryption systems we rely on today. In April 2021, the National Institute for Standards and Technology (NIST), the United States government agency charged with developing cyber security standards, issued a warning.

There is no telling when a quantum computer capable of using Peter Shor's new algorithm will be available to you or potential attackers.

Should that day come in the distant future, all private and secret encryptions protected by the current algorithms and all information available with them will be destined to fall into the wrong hands as well.

Quantum technology in the wrong hands

Imagine a hacker acquiring and storing encrypted data while waiting for a sufficiently sophisticated quantum computer to break the encryption. At that point, all data would be disclosed.

To prevent such scenarios, the transition to quantum-secure encryption systems needs to happen long before large quantum computers are actually operational and available.

In 2016, NIST announced a public competition to find algorithms that could potentially withstand attack by a quantum computer. It is easy to imagine that in the near future companies will have to prove to regulators or auditors that they are on the way to becoming quantum compliant.The results are expected to be announced later this year. Fortunately, there is more to the adoption of quantum computing than just risks, costs and downsides. It will bring benefits that we cannot foresee today.It will also offer so many opportunities that the shift to security and encryption that will come with the dawn of the Quantum Age will be just one of the less relevant chapters.