Deltec Bank, Bahamas - A combination of quantum computing and blockchain technology could change things as transactions can be even more secure and faster with increased encryption.
Research from Juniper Research has suggested that cybercriminals will have stolen 12 billion records by the time we reach the end of 2019 and estimate that could be as much as 33 billion in 2023. With the growth in digital and connected technologies, cyber attacks are becoming a larger problem by the day.
As you might expect, with the likely promise of financial gain, banks are prime targets for any form of cybercrime. To combat the threat, it is important that banks update and review their systems and procedures. They cannot wait for hackers and need to proactively invest in the right technology that meets the needs of a modern-day consumer. Beyond that, banks are processing millions of transactions every day. There is a fear that classical computing will reach its optimum in terms of size and power, especially as data volumes grow and financial institutions invest deeper into artificial intelligence (AI).
To combat these challenges, financial institutions have started to turn towards the field of quantum computing. Experts believe that quantum technology could solve problems related to security, processing power, and data efficiency. In this post, we look at what quantum computing is and how it might impact the banking and financial services industry.
What is quantum computing?
Quantum computers are expected to exceed the capability of classical computers on the next 5 to 10 years. This will provide a vast increase in the processing power over the traditional silicon chips. The finance sector has many areas where more secure, faster transactions would be a huge benefit. With quantum computing, this is made possible whereby the data is represented by what are known as qubits, rather than standard binary bit units (0s and 1s).
Qubits provide greater flexibility as they can allow for a combination of 0s and 1s simultaneously rather than one at a time in classical computing. In short, this means they can store more data than traditional bits. The ability to quickly analyze data and spot patterns is massively increased.
Bloomberg has reported that Googles most advanced quantum computer, Sycamore, could solve a computational task that would take a traditional model 10,000 years, within just 3 minutes.
Quantum computing in banking
There are several ways that quantum computing could impact banking.
Financial data that can be encoded with quantum cryptography will be far more secure than any other kind of digital security method. Data in a quantum state is always changing state meaning it cannot be read, prevent ambitious hackers from getting their hands on too much information.
One of the examples of how quantum cryptography is being used is known as a quantum distributed key system.
Quantum Distributed Keys
Measurement-Device Independent Quantum Key Distribution (MKI-QKD) promises secure digital communication that cannot be broken, even by a quantum computer itself. The system creates very complex mathematical equations that are very time-consuming to complete. However, quantum computers make the calculations instantly simple.
MKI-QKD protects data by combing a secure quantum distributed key with a long message that cannot be broken without the associated key. Without huge technical detail, third-parties can be detected if they eavesdrop, meaning keys created by two parties are no longer identical, disturbing the quantum event. Banks such as ABN-AMRO are already starting to integrate this type of secure technology.
A clear benefit of quantum technology for banking lies in fraud detection. Automation of fraud detection relies on recognizing patterns in data. Quantum computers are perfect for supporting pattern recognition algorithms thanks to their qubit setup, rather than standard bits, as discussed earlier in this post. More advanced fraudulent acts can be detected thanks to self-learning networks and banks can mitigate fraud before it even happens.
Blockchain has been around for some time now but arguably, has never really fulfilled its potential as the next great banking innovation. According to Deltec Bank, Bahamas- A combination of quantum computing and blockchain technology could change things as transactions can be even more secure and faster with increased encryption. It also means that the computing power is there to remove any latency and power issues that exist within blockchain technologies.
Quantum computers will accelerate the field of high-frequency trading. Banks like Barclays and JP Morgan are already experimenting with this kind of technology. This comes through the ability to handle billions of transactions per second in a world where institutions can quickly get overloaded with data, especially where it comes to areas like stock markets. Quantum computing reduces the likelihood of crashes and data loss. Algorithms can be built that automatically initiate trades based on pre-defined strategies.
Quantum computing will likely accelerate the field of artificial intelligence (AI) in banking. AI is heavily reliant on large volumes of data to be able to learn. Given quantum computing can process data faster than ever before, machines will quickly gather feedback that shortens their learning curve.
For example, functions like bank loans could be almost instantaneous as quantum machines can process the data without any latency. Portfolio managers will not need to worry about managing their investments as a quantum system will be able to continuously provide them with optimal solutions.
The future of banking with quantum technology
Reports say that major banks like Barclays and JP Morgan are already looking towards quantum computing as a way to secure their future. These institutions are already experimenting with the technology and researching how it can be deployed in the real-world. The theories are still in their infancy and we will not truly know the impact until such time banks are running tasks fully on quantum machines. This brand new way of working is being referred to as the quantum advantage and will likely be something we hear a lot more about over the forthcoming decade.
Disclaimer: The author of this text, Robin Trehan, has an Undergraduate degree in economics, Masters in international business and finance and MBA in electronic business. Trehan is Senior VP at Deltec International http://www.deltecbank.com. The views, thoughts, and opinions expressed in this text are solely the views of the author, and not necessarily reflecting the views of Deltec International Group, its subsidiaries and/or employees.
About Deltec Bank
Headquartered in The Bahamas, Deltec is an independent financial services group that delivers bespoke solutions to meet clients unique needs. The Deltec group of companies includes Deltec Bank & Trust Limited, Deltec Fund Services Limited, and Deltec Investment Advisers Limited, Deltec Securities Ltd. and Long Cay Captive Management.
Media ContactCompany Name: Deltec International GroupContact Person: Media ManagerEmail: Send EmailPhone: 242 302 4100Country: BahamasWebsite: https://www.deltecbank.com/
- Quantum physicists say time travelers don't have to worry about the butterfly effect - The Next Web - August 2nd, 2020
- Week in review: BootHole, RCEs in industrial VPNs, the cybersecurity profession crisis - Help Net Security - August 2nd, 2020
- New UC-led institute awarded $25M to explore potential of quantum computing and train a future workforce - University of California - July 31st, 2020
- The future of encryption: Getting ready for the quantum computer attack - TechRepublic - July 31st, 2020
- IBM and University of Tokyo team up for Quantum Innovation Initiative Consortium - SmartPlanet.com - July 31st, 2020
- 'Butterfly effect' is wrong and reality can 'heal itself', quantum scientists find in time travel experiment - The Independent - July 31st, 2020
- Research: the butterfly effect does not exist in the quantum model - FREE NEWS - July 31st, 2020
- Solving problems by working together: Could quantum computing hold the key to Covid-19? - ITProPortal - July 2nd, 2020
- Spain Introduces the World's First Quantum Phase Battery - News - All About Circuits - July 2nd, 2020
- Professor tackles one more mystery about quantum mechanics and times flow - GeekWire - July 2nd, 2020
- This Week's Awesome Tech Stories From Around the Web (Through June 27) - Singularity Hub - June 29th, 2020
- Kudos: Read about faculty, staff and student awards, appointments and achievements - Vanderbilt University News - June 29th, 2020
- This Is the First Universal Language for Quantum Computers - Popular Mechanics - June 21st, 2020
- Universal Quantum raises $4.5 million to build a large-scale quantum computer - VentureBeat - June 17th, 2020
- Ethereum (ETH) Might Not have Quantum Resistance on its Roadmap, the QRL Team Reveals - Crowdfund Insider - June 17th, 2020
- Craig Knoblock Named Michael Keston Executive Director of the USC Information Sciences Institute - USC Viterbi School of Engineering - June 17th, 2020
- European quantum computing startup takes its funding to 32M with fresh raise - TechCrunch - June 11th, 2020
- SKT to expand use of new quantum-powered security solutions - The Korea Herald - June 11th, 2020
- Archer looks to commercialisation future with graphene-based biosensor tech - ZDNet - June 11th, 2020
- Dear NASA, please put a particle collider on the Moon - The Next Web - June 11th, 2020
- Top 10 emerging technologies of 2020: Winners and losers - TechRepublic - June 11th, 2020
- When Will Quantum Computing Come to Mainstream? - Analytics Insight - June 8th, 2020
- University announces 2020 winners of Quantrell and Graduate Teaching Awards - UChicago News - June 8th, 2020
- Physicists Found a Way to Save Schrdingers Cat - Dual Dove - June 8th, 2020
- Physicists hunt for room-temperature superconductors that could revolutionize the world's energy system - The Conversation US - June 3rd, 2020
- Covid 19 Pandemic: Quantum Computing Technologies Market 2020, Share, Growth, Trends And Forecast To 2025 - 3rd Watch News - May 24th, 2020
- Molecular dynamics used to simulate 100 million atoms | Opinion - Chemistry World - May 23rd, 2020
- Highest-performing quantum simulator IN THE WORLD delivered to Japan - TechGeek - May 18th, 2020
- Light, fantastic: the path ahead for faster, smaller computer processors - News - The University of Sydney - May 18th, 2020
- Wiring the quantum computer of the future - Space Daily - April 29th, 2020
- Technologies That You Can Explore Other Than Data Science During Lockdown - Analytics India Magazine - April 29th, 2020
- Will Quantum Computing Really Change The World? Facts And Myths - Analytics India Magazine - April 23rd, 2020
- Google's top quantum computing brain may or may not have quit - Fudzilla - April 23rd, 2020
- On the Heels of a Light Beam - Scientific American - April 23rd, 2020
- Advanced Encryption Standard (AES): What It Is and How It Works - Hashed Out by The SSL Store - Hashed Out by The SSL Store - April 23rd, 2020
- Google's Head of Quantum Computing Hardware Resigns - WIRED - April 21st, 2020
- COVID-19: Quantum computing could someday find cures for coronaviruses and other diseases - TechRepublic - April 21st, 2020
- The future of quantum computing in the cloud - TechTarget - April 21st, 2020
- Quantum computer chips demonstrated at the highest temperatures ever - New Scientist News - April 17th, 2020
- Alex Garland on 'Devs,' free will and quantum computing - Engadget - April 14th, 2020
- RAND report finds that, like fusion power and Half Life 3, quantum computing is still 15 years away - The Register - April 12th, 2020
- Quantum computing: When to expect the next major leap - TechRepublic - April 12th, 2020
- Cambridge Quantum Computing Performs the World's First Quantum Natural Language Processing Experiment - Quantaneo, the Quantum Computing Source - April 12th, 2020
- The Well-matched Combo of Quantum Computing and Machine Learning - Analytics Insight - March 23rd, 2020
- Picking up the quantum technology baton - The Hindu - March 23rd, 2020
- Research by University of Chicago PhD Student and EPiQC Wins IBM Q Best Paper - HPCwire - March 23rd, 2020
- Honeywell Achieves Breakthrough That Will Enable The Worlds Most Powerful Quantum Computer #47655 - New Kerala - March 23rd, 2020
- Is time broken? Physicists filmed a quantum measurement but the 'moment' was blurry - The Next Web - March 5th, 2020
- What Is Quantum Computing? The Next Era of Computational ... - March 3rd, 2020
- Honeywell says it will soon launch the worlds most powerful quantum computer - TechCrunch - March 3rd, 2020
- Majority of Promising AI Startups Are Still Based in the US - Transport Topics Online - March 3rd, 2020
- 10 Revolutionary Technologies To Lookout For In 2020 - Fossbytes - March 3rd, 2020
- Quantum researchers able to split one photon into three - Space Daily - March 3rd, 2020
- Physicists Captured The Moment That An Atom Enters Quantum Measurement - Somag News - February 29th, 2020
- This Week's Awesome Tech Stories From Around the Web (Through February 29) - Singularity Hub - February 29th, 2020
- IC Breakthroughs: Energy Harvesting, Quantum Computing, and a 96-Core Processor in Six Chiplets - News - All About Circuits - February 29th, 2020
- Top 10 Strategic Technology Breakthroughs That Will Transform Our Lives - Analytics Insight - February 29th, 2020
- New Intel chip could accelerate the advent of quantum computing - RedShark News - February 28th, 2020
- Particle accelerator technology could solve one of the most vexing problems in building quantum computers - Fermi National Accelerator Laboratory - February 28th, 2020
- Top 10 breakthrough technologies of 2020 - TechRepublic - February 28th, 2020
- 21st ISQED Conference to Commence With Focus on Quantum Computing, Security, and AI/ML & Electronic Design - PRNewswire - February 25th, 2020
- NTT Research to Collaborate with UCLA and Georgetown on Cryptography and Blockchain - Yahoo Finance - February 25th, 2020
- Should decision makers be concerned by the threat of quantum? - Information Age - February 25th, 2020
- Keeping classified information secret in a world of quantum computing - Bulletin of the Atomic Scientists - February 11th, 2020
- A neural network that learned to predict the behavior of a quantum system - Tech Explorist - February 9th, 2020
- Could Photonic Chips Outpace the Fastest Supercomputers? - Singularity Hub - February 5th, 2020
- Google claims to have invented a quantum computer, but IBM begs to differ - The Conversation CA - January 22nd, 2020
- Xanadu Receives $4.4M Investment from SDTC to Advance its Photonic Quantum Computing Technology - Quantaneo, the Quantum Computing Source - January 22nd, 2020
- U of T's Peter Wittek, who will be remembered at Feb. 3 event, on why the future is quantum - News@UofT - January 17th, 2020
- Quantum Computing Technologies Market 2019, Size, Share, Global Industry Growth, Business Statistics, Top Leaders, Competitive Landscape, Forecast To... - January 17th, 2020
- This Week In Security: Windows 10 Apocalypse, Paypal Problems, And Cablehaunt - Hackaday - January 17th, 2020
- Kitchener's Angstrom Engineering is making a quantum leap with its next-generation technology - TheRecord.com - January 17th, 2020
- Xanadu Receives $4.4M Investment from SDTC to Advance its Photonic Quantum Computing Technology - Yahoo Finance - January 16th, 2020
- The dark side of IoT, AI and quantum computing: Hacking, data breaches and existential threat - ZDNet - January 16th, 2020
- 'How can we compete with Google?': the battle to train quantum coders - The Guardian - January 16th, 2020
- IBM heads US patent list for 27th consecutive year - Technology Decisions - January 16th, 2020
- New Technique May Be Capable of Creating Qubits From Silicon Carbide Wafer - Tom's Hardware - January 14th, 2020
- The hunt for the 'angel particle' continues - Big Think - January 13th, 2020
- How to verify that quantum chips are computing correctly - MIT News - January 13th, 2020
- Googles Quantum Supremacy will mark the End of the Bitcoin in 2020 - The Coin Republic - January 13th, 2020