HSBC, a well-established British bank, is the first to partake in the innovative quantum “metro” network set up by BT (formerly British Telecom) and Toshiba in the UK, marking a significant advancement in secure banking technology.
HSBC, located in the heart of London and ranked eighth globally among banks, plans to delve into a variety of trials and experiments centered on quantum encryption technology. The bank will collaborate with Amazon Web Services, BT, and Toshiba for this venture.
Stepping forward as the pioneering bank to commit to trials on this ground-breaking quantum “metro” network, HSBC is looking to explore the potential of a secure transaction system underpinned by the impenetrable encryption that quantum cryptography offers.
This quantum metro network, a joint venture between Toshiba and telecom titan BT, is designed to ensure the highest level of security during transactions between institutions. HSBC has plans to evaluate a multitude of use-cases on this network, which encompasses financial transactions, video communication, and edge computing.
HSBC is set to investigate a key application of quantum technology known as “quantum key distribution” (QKD). This unique technology enables two geographically distant parties to securely exchange information.
QKDs generate one-time encryption keys for both parties concurrently. Due to a phenomenon known as “spooky action at a distance”, first noted by Albert Einstein, quantum states are subject to collapse when measured. This characteristic makes quantum data seemingly indestructible.
This feature of QKD means that any attempt by an external entity to observe, listen in on, intercept, or manipulate a transaction protected by QKD would be instantly detectable by the two involved parties.
At present, QKDs are restricted by how far they can be transmitted. When dealing with conventional data, the strength of the photon signal can be enhanced for transmission over long distances through fiber optics. However, photons carrying quantum data cannot be amplified in the same manner.
Quantum information is inherently “noisy”, leading to an exponential loss in photons carrying quantum data. This results in decreased survivability of quantum data during transmission over long fiber optic networks. Though it is theoretically possible to overcome these limitations with higher-intensity photons, the scientific community is still in the early stages of devising such solutions.
Researchers in China announced a breakthrough in May 2023, having successfully transmitted QKDs over an unprecedented distance of 1,000 kilometers (621 miles) of fiber optic cable. This achievement sets a new record for non-relay QKD transmission.
The HSBC trials on the BT-Toshiba metro network will not need to span such vast distances. The announcement indicates that the trials will be conducted over a 62-kilometer (38-mile) stretch of fiber optic cables in England. This network will connect HSBC’s global headquarters in Canary Wharf with a data center in Berkshire.