Will quantum computing, not AI, define our future?
The interaction between quantum and AI is the most exciting development in modern-day technologies. The hype cycle is focused on AI, but in the words of Lord (William) Hague, speaking recently at Imperial College: “Quantum computers can provide AI with the computational firepower needed to unlock their full potential. This means that if the country can lead on quantum computers, we can secure a lead on AI. And if we fall behind on quantum, we will likely fall behind on AI.”
The essence of quantum is that it isn’t binary – even today’s supercomputers are – but instead allows for multiple possibilities at the same time, making it ideal for optimisation problems. And the UK has the second largest number of quantum start-ups in the world, plus a £2.5bn quantum strategy.
There are two misapprehensions about quantum. The first is that it is prohibitively expensive because of the construction costs of a quantum computer and the environment in which it needs to be kept. In fact, companies can access time on one via the Cloud, with Microsoft Azure and AWS, among others, offering it as a service used by banks like HSBC and JPMorgan.
Second, quantum is only about computing, with the goal of creating a quantum computer within five to ten years that can break current encryption. In fact, quantum and quantum-inspired algorithms are already being used on classical computers, and the rather basic quantum computers – think of your first iPhone – that we have today.
Additionally, there is a large product suite associated with the technology. Quantum sensors, for instance, are one of the most exciting developments in the field of quantum physics. They are a magnitude more powerful than current ones in identifying minerals underground or coin-sized holes in undersea gas pipes and are likely to be commercialised by companies like Bosch within the next two years. And there are other quantum technologies being worked on in parallel, such as a quantum internet, all of which provide venture capitalists with investment opportunities.
Quantum in the finance sector
The financial services industry is already experimenting with quantum and machine learning.
In CB Insights’ recently published list of 100 Top 100 AI Companies, only two quantum companies are mentioned: Sandbox AG and Multiverse, one an American spin-out from Google, the other a European medium-sized start-up with UK offices.
Multiverse, which I advise, has worked with the Bank of Canada on cryptocurrency scenarios; with Credit Agricole CIB on counterparty credit rating downgrades and valuations of derivatives; with Spanish bank BBVA on maximising portfolio returns for a given level of risk, and a host of others.
Marco Pistoia, the managing director of JPMorgan Chase’s Global Technology Applied Research Center, is very clear on why the banking behemoth is seriously investing in quantum: it promises dramatic speed-up and accuracy improvements in optimisation, simulation and machine learning. Finance is awash with exponential complexity, and classical computers cannot deal with big datasets, let alone with the time constraints usual in the industry.
Quantum machine learning will also be useful in predicting financial crisesHSBC, meanwhile, recently announced quantum computing projects in cybersecurity and fraud detection, and became the first bank to join BT and Toshiba’s quantum-secured metro network (QSMN) to protect against cyberthreats. The QSMN connects the Canary Wharf headquarters with the global bank’s data centre in Berkshire, and will be used to trial experiments such as secure video communication and financial transactions.
Quantum machine learning will also be useful in predicting financial crises. Financial firms and regulators have access to large amounts of data, but analysing them intelligently within a usable time frame requires more computing power and AI than is currently available.
Consultancy Boston Consulting Group estimates that at maturity (projected to be around 2035), quantum technology can create US$450bn to US$850bn in net income for end users through a combination of new revenue generation and cost savings.
William Hague recently wrote a couple of reports with Tony Blair, urging the Labour and Conservative parties to make leadership in science and innovation, and AI especially, the New National Purpose. As he points out, quantum is a keystone technology. “You don’t need to understand how quantum works to understand how quantum will revolutionise our world,” were his parting words at the event at Imperial.
The mind-boggling possibilities of AI using quantum as its underpinning technology is one of the reasons I founded The City Quantum and AI Summit at the Mansion House. The annual event, now in its third year, brings together the City and the quantum community, with three principles: free for all; no jargon, no lingo, only understandable language; gender-balanced panels.
We welcome all of the CISI community to the Mansion House on Monday 2 October in a bid to ensure the City leverages its world-leading role by adopting this world-changing technology.