The Bank of England (BoE) recently published a blog post examining how quantum computers could transform financial markets and payment systems.

BoE senior data scientist Ed Hill notes that quantum networks may enable a “fundamental change to what a payment means.” They could let parties communicate complex conditional payment strategies, akin to the contingencies in a housing market chain “but much more complex and interrelated.” Hill gives a real estate example – instead of a simple “buy” order, a party could instruct “buy, if…” certain other payment conditions are met. A quantum computer could then quickly solve which combination of instructions should proceed.

As Hill concludes, “These high-level changes will become clearer as quantum computers, networks and other technologies continue their journey from science fiction to reality.”

## Understanding How Quantum Computing Works

Quantum computing is not yet practical, but major tech firms are exploring its potential to solve complex problems at unprecedented speeds. While classical computers use binary bits with values of 0 or 1, quantum computers utilize “qubits” that can be 0 and 1 simultaneously – enabling the parallel processing of vast information. The emerging technology leverages quantum mechanics principles to solve problems too complex for traditional computers.

## IBM Leads the Charge

IBM recently unveiled its IBM Quantum System Two, a modular quantum computer which it claims will “further increase the quality of a utility-scale quantum technology stack” and empower real-world problem-solving. Several IBM breakthroughs have advanced the field, like a new process allowing a quantum computer to solve a complex problem impossible for a classical computer.

## Threats to Blockchains and Cryptocurrencies

Looking ahead, quantum computers may be able to quickly crack the cryptographic puzzles securing blockchains and cryptocurrency mining. As reported in Nature, quantum computing threatens blockchain protocols because they use non-quantum-resistant cryptography. Once scaled up, quantum computers running Shor’s algorithm could break widely used signature and encryption schemes like RSA and ECDSA.