The quantum cryptography market in BFSI is expected to grow at a CAGR of 21.5% during the forecast period (2020-2026). In January 2018, IBM announced a series of partnerships with major academic institutions, corporations, and national research labs in order to explore practical inference of the cutting-edge technology of quantum computing. JPMorgan Chase signed on to explore how the tech could be used in financial services.
- Banks and financial establishments need to secure transaction and communication between them and their clients. Every day, thousands of million dollars transactions are performed between banks. This transmission must be secure and need to satisfy security requirements such as authentication, confidentiality, and integrity. Quantum cryptography could be used, in this context, to offer particular secure communication.
- Nowadays, Banks and financial institutions use either symmetric cryptography or asymmetric cryptography. Both techniques, as proved above, are not unconditionally secure. So transactions could be corrupted and altered without the awareness of the bank. This constitutes a danger because criminals and malicious organizations could profit from the breach to steal and highjack. Securing critical financial transaction is mandatory and will be more and more necessary to master economic crime.
- Quantum computing can unlock new opportunities for banks in risk assessment and trading, allowing them to make computations much faster than existing computing power allows.JPMorgan Chase joined the IBM Q Network, a collaboration of leading Fortune 500 companies, national research labs, and academic institutions working with IBM to advance quantum computing.
- Potential use cases of quantum cryptography in BFSI are portfolio analysis, fraud detection, optimization, quantum proofing of cybersecurity systems, high-frequency trading, clustering, and asset valuation.
Key Market Trends
The Need for Secure Information Sharing Driving the Demand
- Quantum cryptography utilizes the concept of physics, as against that of mathematics, which is used for other cryptographies. It helps make quantum cryptography practically impossible to hack, without the knowledge of the actual party the message was meant for. This special feature makes the technique apt for business and segments, where the information being shared is critical for operations.
- With the present-day technologies, information sharing has some limitations, as it can be carried without any distortions and noise, for approximately 60 km. This limitation is a blessing in disguise for businesses like BFSI, where a head branch has to communicate with its peers, subordinates, and clients within this radius. It suits both intra- and inter-organization communication. The security feature is a pre-requisite in transactions between the parties involved.
- As it can also be seen that the number of quantum computing patent application across the world is increasing. The united states lead the quantum computing patent application followed by China and japan. The presence of tech giant around the United States is driving the quantum computing market.
North America Accounts for the Largest Share in Quantum Cryptography Market
- North America has been a pioneer in the adoption of innovations, given its position as an incubator of new technology, with offices of all major MNCs in the country. The early adoption of technology has provided the country edge over the other regions.
- The major research companies in the market studied are based in the United States, making it easier for service providers to offer their services. The presence of basic infrastructure and supporting facilities, such as fiber optic network, communication channel, and availability of quantum and cloud computing machines, etc., augment the demand. The market studied is expected to follow a similar trend in this region, during the forecast period.
The quantum cryptography market in BFSI is consolidated due to a major share of the market is occupied by top players. Some of the key players in the market are Anhui Qasky Science And Technology Limited Liability Company, D-wave Systems Inc., Hamamatsu Photonics, IBM Research, Microsoft Research, Quantumctek Co. Ltd., Quintessence Labs, among others.
- July 2019 - Sigma-i Co. Ltd., a company formed to optimize the world with quantum computing technologies, and D-Wave Systems Inc., the leader in quantum computing systems, software and services, announced the companies have signed the largest-ever global quantum cloud contract. Sigma-i will offer quantum consulting services and access to the D-Wave 2000Q family of systems via D-Wave's quantum cloud service, Leap, to companies, universities and research laboratories throughout Japan.
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