Threat or Opportunity With this article, I would like to make an introduction to the potential areas of use of quantum computing . Quantum...
Threat or Opportunity
With this article, I would like to make an introduction to the potential areas of use of quantum computing. Quantum computing technology, which promises a bright future in the financial sector, especially in areas such as creating financial asset buying/selling strategies and portfolio optimization, is a candidate to make radical changes in an area that is at least as important, if not more important: Data security .
Modern encryption (cryptology) methods, which we encounter at every stage of our lives and have become a part of almost all our work, derive their power from the difficulty of separating very large numbers into their prime factors. For example, RSA, a widely popular type of public-key encryption method developed by three MIT professors in 1977, owes its reliability to the difficulty of factoring integers into their prime factors. So much so that 2048-bit and even 4096-bit RSA encryption, which is actively used in many strategic areas by actors such as governments, financial institutions and armed forces, is almost impossible to break with classical computers (or even supercomputers) (Unless we have billions of years of time!). Let's remember that the largest RSA key that can be cracked today is 768 bits in size and that there is an exponential relationship between key size and password cracking time. However, as with every new technology, it was inevitable that encryption technology would evolve in the face of dizzying developments in quantum computing. As a matter of fact, it happened.
The so-called “unbreakable” RSA received its biggest blow from another MIT professor in 1994: Peter Shor.
Let's do a little brain exercise:
What are the prime factors of the number 15? The easy answer is 3 and 5.
So, what are the prime factors of 123? Again, we can find the answer without much difficulty: 3 and 41.
So, what are the prime factors of the number 456,055,181?
As we mentioned above, in order to divide very large numbers into their prime factors, the legendary American mathematician Peter Shor developed a revolutionary algorithm [1] in 1994, especially for use in quantum computers. In order to better understand this algorithm, which consists of 7 stages, I have given a small example next to the page. Readers can test the method with different numbers if they wish.
Steps 1-2-3-5-6 and 7 of the algorithm are very easy for classical computers. However, classical computers are quite slow when it comes to the fourth stage, that is, finding the number r ( subroutine ). As a matter of fact, it is not a coincidence that Peter Shor developed this method for application in quantum computers.
Of course, we can quickly mentally factor very small numbers, like the 21 we used in our example, into their prime factors. We can divide three-digit and even four-digit numbers into their prime factors in a short time using paper and pencil, thanks to the Shor algorithm. But in larger numbers, our job becomes very difficult, even if we get help from computers. At this stage, quantum computers that use the strange features of quantum mechanics such as superposition and entanglement come to our rescue. As can be seen in the picture below, the time that increases exponentially as the number grows in classical computers increases logarithmically in quantum computers, allowing us to factorize incredibly large numbers in a very short time.
However, let's not forget that we are just at the beginning
Although the Shor algorithm reaches results incredibly quickly on quantum computers, the largest number that can be divided into prime factors using this method on quantum computers today is 21. The main reason for this is that the duration of qubits in the quantum state is very short. Today, the duration of qubits in the quantum state varies between 50 and 90 microseconds. That is, 9 hundred thousandths of a second! This means that to crack 2048-bit RSA with 4,100 qubits in 10 seconds, we need 100 thousand times improved versions of today's quantum computers! With today's quantum technology, the same password can only be cracked in 8 hours using 20 million qubits! Therefore, we do not need to be afraid until we develop near-perfect quantum systems that can operate with almost zero margin of error, and we have many years ahead of us for this.
Data security can evolve to a whole new level with quantum cryptography
Although methods such as Shor's algorithm pose a threat to traditional encryption technology, there is also the other side of the coin. Quantum computing technology, which develops day by day, can enable us to produce passwords that can "never" be cracked with traditional methods.
In quantum technology, data security is provided by quantum cryptography. One of the most well-known ways to do this is the quantum key distribution method. Under normal circumstances, messages between two users who want to have a secret conversation are encrypted with a bit string (key) of a certain length, and encrypted messages are sent to the parties through public channels. Just like the RSA method we mentioned at the beginning of the article. This paves the way for the conversation to be listened to by third parties (at least in theory) by obtaining the key. In the quantum key distribution system, which derives its power from the principles of quantum mechanics rather than the length of the password, a third party trying to listen to the secret conversation causes various errors that it cannot prevent in the system, and these errors enable the parties of the conversation to detect that they are being listened to.
Let us also add that the test projects carried out in this field have yielded very positive results.
For example, a fund transfer of 3,000 euros between Bank Austria Creditanstalt and Vienna City Hall in 2004 was encrypted with the help of entangled photons. While the currently used fund transfer system, which takes place through a 1.5 km fiber optic connection, provides maximum security due to the use of entangled photons, this system can in principle operate safely up to a distance of 20 km, and for distances longer than this, the reliable travel of photons cannot be guaranteed. highlighted.
Two of the most exciting developments in this field took place in 2016 and 2017. In 2016, China placed Micius, the world's first quantum communication satellite, into Earth orbit, thus paving the way for organizations to maximize data security with quantum encryption technology, which would take thousands of years to break with today's technology. In 2017, ICBC, one of China's largest banks, managed to transfer data encrypted with quantum technology between Beijing and Shanghai. We can say that this example is of critical importance in terms of exceeding the 1000-km threshold for the first time in this field in the global banking world.
To give a final example, St. Petersburg in 2019. At the St. Petersburg International Economic Forum, Sberbank, Gazprombank, PwC and the Russian Quantum Center held the first secure video conference call between themselves using the QKD (Quantum Key Distribution) method.
Infrastructure needs to be prepared now to protect all strategically important systems with quantum cryptography.
One of the institutions that thinks the effects of quantum cryptography will be felt in the near future is the World Economic Forum. In its report analyzing the transition to economic systems with quantum security in 2022, the institution defined the period between 2020 and 2030 as a transition period with a very optimistic forecast, and predicted that after this date, systems not protected by quantum cryptography will be vulnerable to attacks. It has been stated that between 2030 and 2035, quantum encryption of all kinds of critical information stored virtually is mandatory. To give a numerical example based on the critical importance of this situation for financial markets, the report in question states that 25% of Bitcoins and 65% of Ethereums in circulation may be vulnerable to quantum attacks, and this situation puts approximately 40 billion dollars at risk at today's exchange rates. It has been stated that it shows that . Sooner or later we will all be introduced to quantum cryptography in some way, direct or indirect, good or bad. Therefore, the sooner we give due importance to this area and adapt our systems, the better. Let's not forget that being caught unprepared for this wave could be disastrous for us.
[1] We can define the algorithm, which owes its name to Khwarezmi, a Persian scientist who lived in the 9th century, as a set of finite operations defined to do a job, starting from an initial state and ending in a clearly defined final state. In other words, it is actually a set of instructions with a clear beginning and end. In its simplest form, the cake recipe is an algorithm, starting with mixing the necessary ingredients in order and ending with preheating the oven.
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