HSBC Conducts Trial of Quantum-Safe Financial Transaction Network in the UK

HSBC, a prominent London-based bank and one of the largest globally, has partnered with Amazon Web Services (AWS), BT, and Toshiba to conduct a series of trials and experiments involving quantum encryption technology.

The bank is set to become the first financial institution to participate in trials on the innovative quantum “metro” network, a secure transaction system that leverages unbreakable encryption through quantum cryptography.

The quantum metro network, developed in collaboration between Toshiba and telecommunications giant BT, facilitates unconditional security for transactions between institutions. HSBC will test various use cases on the network, including financial transactions, video calls, and edge computing.

Among the key areas of quantum technology that HSBC will explore is “quantum key distribution” (QKD). QKD involves the generation of unique encryption keys for both parties involved in a transaction simultaneously. Thanks to the phenomenon of quantum states collapsing upon measurement, quantum data becomes virtually impenetrable.

Through QKD, any attempt by external parties to view, intercept, eavesdrop, or modify a transaction equipped with this technology would be instantly detectable by both parties involved.

Currently, QKDs face limitations when it comes to distance transmission. Unlike classical data that can be amplified for long-distance transmission through fiber optics, quantum data suffers from exponential loss due to its inherently “noisy” nature. As a result, the longer the fiber optic network, the less likely quantum data will survive transmission. However, researchers are exploring solutions such as higher-intensity photons to overcome these limitations.

While scientists in China recently achieved a world record by successfully sending QKDs across 1,000 kilometers (621 miles) of fiber optic cable, the HSBC trials on the BT-Toshiba metro network will cover a shorter distance. The tests will take place over a 62-kilometer (38-mile) fiber optic cable network in England, connecting HSBC’s global headquarters in Canary Wharf to a data center in Berkshire.

By collaborating with industry leaders in the quantum encryption space, HSBC aims to explore the potential of quantum technology to enhance the security and resilience of financial transactions, paving the way for more secure and trustworthy banking services.

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