London-based HSBC, the eighth larger bank of the world, will carry out a series of tests and experiments using quantum encryption technology in collaboration with Amazon Web Services, BT and Toshiba.
HSBC is the first bank to commit to testing the new quantum "metro" network, a secure transaction system that uses unbreakable encryption to secure transactions via quantum cryptography.
Developed by Toshiba in partnership with telecommunications giant BT, the Quantum Metro network is designed to enable unconditionally secure transactions between institutions. HSBC will test various use cases on the network, including financial transactions, video calls and edge computing.
One of the key uses of quantum technology that HSBC will experiment with is called "quantum key distribution" (QKD). This is essentially the secret sauce that allows two parties separated by distance to send information to each other securely.
QKDs are unique encryption keys generated for both parties at the same time. Thanks to what Albert Einstein considered "spooky action at a distance", quantum states tend to collapse when measured. Therefore, quantum data is considered impenetrable.
For the purposes of QKD, this means that any attempt by an external party to view, eavesdrop, intercept, or modify an equipped transaction would be instantly detectable by both parties.
Related: Researchers demonstrate 'unconditionally secure' quantum digital payments
Currently, there are technological limitations on the distance that QKDs can be sent. When we send classical data, information intended for use by a traditional non-quantum computer, over long distances over fiber optics, we can increase the signal strength of the photons carrying the data.
However, the photons that carry quantum data cannot be boosted and suffer exponential loss due to the "noisy" nature of quantum information. This means that the longer the fiber optic network, the less likely the quantum data will survive transmission. Theoretically, the current limits can be overcome using photons of higher intensity, but scientists are just beginning to develop these solutions.
Scientists in China, for example, published research in May 2023 indicating that they had successfully sent QKD over 1000 kilometers of fiber optic cable, a new world record for QKD without retransmission.
However, HSBC's ongoing tests on the BT-Toshiba metro network will not need as much track. According to the announcement, the tests will be carried out on 62 kilometers of fiber optic cables connecting the bank's global headquarters in Canary Wharf with a data center in Berkshire.
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