The World Economic Forum (WEF) and the UK’s Financial Conduct Authority (FCA) have jointly published a white paper addressing the need for a coordinated effort in quantum security in the financial sector. Proposing four guiding principles and a four-phase transition roadmap, the paper was designed to establish the groundwork for further discussions between industry stakeholders and regulatory authorities.
Describing the financial sector as “on the brink of a transformation from a digital economy to a quantum economy”, the report warned that although quantum computing has the potential to “revolutionise” operations and fraud detection, it would also “render most current encryption schemes obsolete, threatening consumer protections and the integrity of digital infrastructures and economies”.
Four principles, four phases
The paper proposed four guiding principles for global regulation:
• Reuse and repurpose – not to reinvent the wheel, but to make the best use of existing regulatory frameworks and industry practices to address new quantum related threats.
• Establish non-negotiables – ensure a standardised approach to mitigating quantum enabled cybersecurity threats and for defining cybersecurity requirements.
• Increase transparency – share strategies and best practices.
• Avoid fragmentation – think global to avoid regulatory fragmentation and enable harmonised approaches to regulation worldwide.
Acknowledging that “the transition itself is a journey”, the paper also proposed a four-phased roadmap for transformation: prepare; clarify; guide; transition and monitor.
Numbers quoted from a Deloitte study conducted last year revealed that investments in quantum technology within the financial sector is expected to reach US$19 billion by 2032, while the US’ National Security Memorandum of May 2022 urged the industry to be ready for quantum threats by 2035. With these facts in mind, the white paper urged the sector to embark on the transition towards a quantum-secure economy “with urgency and resolve”.