HSBC Trials Quantum Protection for FX Trading

HSBC has claimed a world-first by pioneering quantum protection for an AI-powered FX trade, to protect trades and trade information from cyber threats including quantum attacks.

The bank trialled a EUR/USD trade for 30 million on its AI Markets platform protected by Quantum Key Distribution, which uses particles of light and the fundamental properties of quantum physics to deliver secret keys between parties that can be used to encrypt and decrypt sensitive data. HSBC says these keys are safe from eavesdroppers or cyber-attacks by quantum computers.

The bank adds that the trial proves it will have the power to safeguard trades of any value from quantum attacks as the technology becomes scalable and more commercially accessible.

The trial was powered by BT, Toshiba and Amazon Web Services (AWS), HSBC joined BT and Toshiba’s quantum secure metro network in July and installed quantum infrastructure in its UK headquarters.

The bank says its quantum scientists, cyber-crime experts and trading specialists will use the insight generated by this experiment to inform how Quantum Key Distribution can be integrated into HSBC’s most important trading tools to secure them against quantum attacks in the future.

The increasing threat of cyber-attacks and the emergence of quantum computers are widely seen as posing a real threat to the financial sector, and HSBC says waiting until quantum computers become a reality to address this issue risks leaving financial systems vulnerable, as the transition to quantum-resistant encryption takes time. “HSBC is committed to proactive research and development in this area to ensure the continued resilience of its financial systems in an increasingly quantum future,” the bank states.

It adds this work represents an important step towards the UK Government’s ambition to enable the commercial viability of quantum communications as outlined in the recent National Quantum Strategy.

“The quantum revolution is not on the horizon; it’s already here,” states Colin Bell, CEO of HSBC Bank and HSBC Europe. “By investing and experimenting in quantum technologies now, HSBC is not just preparing for the future; we’re shaping it.

“Today’s trials will define tomorrow’s triumphs,” he continues. “Successfully pioneering quantum protection for our FX trading is a significant step with far-reaching implications for the blueprint of our future cybersecurity. We are determined to do whatever we can to protect our customers assets, both now and in the future. This trial marks an important step in this commitment.”

Richard Bibbey, global head of FX and emerging markets Rates and commodities, adds, “In the world of foreign exchange trading, currency dynamics are evolving faster than ever. Ensuring the security of our client’s data is paramount and we must constantly innovate and stay ahead of the curve.

“This ground-breaking quantum experiment marks a considerable leap in the world of finance,” he adds. “For the first time, we have leveraged the power of quantum communications to further reinforce our secure trading and transactions.”