IBM’s stock jumped 5% yesterday after HSBC bank announced it found a 34% improvement in predicting the price a bond will trade by using the tech company’s quantum computers.
The news is a breakthrough, marking a real-world application of quantum computing in finance.
While the findings are theoretical and based on past data, HSBC called it its clearest demonstration yet of quantum’s potential value.
Bloomberg noted that even a 34% edge could deliver major gains for banks. HSBC, JPMorgan, Goldman Sachs, Wells Fargo, and Citigroup are all in the top five of the Quantum Innovation Index, which measures financial institutions for their “quantum readiness.”
Analysts note that IBM is competing with Google and other tech companies to build a large-scale quantum computer by 2030. It plans to spend over $30 billion to expand its quantum computer and mainframe production.
Google revealed last December that its Willow, a 105-qubit quantum chip, can solve a test problem in five minutes, which would take today’s fastest supercomputers 10 septillion years, longer than the universe’s age.
In February, Microsoft unveiled its Majorana 1 chip, a type of quantum bit that could make quantum computers more stable and reliable.
Quantum computing is believed to fast-track drug discovery, finance, research, and other fields. Experts warn that quantum advances could also pose risks to data security by undermining current encryption methods.