IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/2021-071.html
   My bibliography  Save this paper

Quantum Computing and the Financial System: Spooky Action at a Distance?

Author

Listed:
  • Mr. Michael Gorbanyov
  • Majid Malaika
  • Tahsin Saadi Sedik

Abstract

The era of quantum computing is about to begin, with profound implications for the global economy and the financial system. Rapid development of quantum computing brings both benefits and risks. Quantum computers can revolutionize industries and fields that require significant computing power, including modeling financial markets, designing new effective medicines and vaccines, and empowering artificial intelligence, as well as creating a new and secure way of communication (quantum Internet). But they would also crack many of the current encryption algorithms and threaten financial stability by compromising the security of mobile banking, e-commerce, fintech, digital currencies, and Internet information exchange. While the work on quantum-safe encryption is still in progress, financial institutions should take steps now to prepare for the cryptographic transition, by assessing future and retroactive risks from quantum computers, taking an inventory of their cryptographic algorithms (especially public keys), and building cryptographic agility to improve the overall cybersecurity resilience.

Suggested Citation

  • Mr. Michael Gorbanyov & Majid Malaika & Tahsin Saadi Sedik, 2021. "Quantum Computing and the Financial System: Spooky Action at a Distance?," IMF Working Papers 2021/071, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2021/071
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=50159
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Raphael Auer & Angela Dupont & Leonardo Gambacorta & Joon Suk Park & Koji Takahashi & Andras Valko, 2024. "Quantum computing and the financial system: opportunities and risks," BIS Papers, Bank for International Settlements, number 149.
    2. Cristina Andriani & Lorenzo Bencivelli & Antonio Castellucci & Mauro De Santis & Sabina Marchetti & Giovanna Piantanida, 2024. "The quantum challenge: implications and strategies for a secure financial system," Questioni di Economia e Finanza (Occasional Papers) 877, Bank of Italy, Economic Research and International Relations Area.

    More about this item

    Keywords

    quantum computing; quantum-safe encryption; cybersecurity; fintech.; fintech; functioning quantum computer; computing technology; quantum machine; encryption standard; hardware capability; cloud service; Computer science; Migration; Financial sector; Global;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:2021/071. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.