Goldman Sachs, JPMorgan sharply diverge on quantum computing

Goldman Sachs (NYSE: GS) and JPMorgan Chase (NYSE: JPM), two of Wall Street's banking giants, have chosen sharply different paths when it comes to quantum computing, Bloomberg reported.

Quantum computing is a rapidly emerging field that uses quantum mechanics to solve complex problems too advanced for classical supercomputers.

Instead of traditional bits, these computers use quantum bits called qubits, which can represent 0, 1, or both simultaneously, to perform calculations exponentially faster.

Related: After Google, largest U.S. crypto exchange warns of quantum threat

Goldman scales back quantum program

As per the Bloomberg report, Goldman has retreated from its efforts on quantum research after internal research indicated that the current system was nowhere close to delivering any practical investment applications.

The investment bank had hired experts a few years ago to study the impact of quantum systems on returns for high-net-worth clients.

These experts concluded it would require millions of years for a potential algorithm to run. In fact, around 8 million qubits would be for the purpose, much higher than current standards of systems running on fewer than 100 qubits.

As a result, Goldman decided to scale back its quantum program.

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JPMorgan continues with quantum research

JPMorgan Chase has taken a completely different approach to quantum computing.

It has an expert team of more than 50 physicists, mathematicians and computer scientists who are studying the impact of quantum computing on banking use cases such as portfolio construction, machine learning, pricing models, and cybersecurity.

Last year, a team of researchers from JPMorgan, Quantinuum, Argonne National Laboratory, Oak Ridge National Laboratory, and the University of Texas at Austin worked on experiments harnessing quantum computing for
"certified ramdomness."

Randomness's essential applications include areas like cryptography, fairness, and privacy.

The bank has also partnered with Amazon (Nasdaq: AMZN) to study use cases such as investment portfolio optimization, but an internal study said the technology had limited practical applications for now.

More on Quantum Computing:

• Researcher uses quantum computer to crack key that protects Bitcoin
• New study from BTQ Technologies identifies real quantum threat to Bitcoin
• Quantum threat looms far beyond Bitcoin, says Grayscale

Google's warnings worry Bitcoiners

As far as the Bitcoin (BTC) community is concerned, it is quite apprehensive of the quantum technology.

Cryptocurrencies like Bitcoin rely, as the name suggests, on cryptography to encrypt or hide sensitive financial details from individuals not party to the transactions.

Quantum computers can one day become powerful enough to decrypt cryptocurrencies like Bitcoin, the community fears.

Last month, Google published a whitepaper in which researchers warned that a quantum system could attack a Bitcoin transaction in about nine minutes.

Instead of going after old wallets, a quantum hacker could target a real-time Bitcoin transaction, the paper warned.

When a Bitcoin transaction is made, the public key is briefly revealed to everyone online. A powerful, fast quantum computer can use this information to arrive at the private key and steal the virtual currency.

In fact, Google has also warned that the encryption protecting the world’s banks, governments, and personal data could be broken by 2029 and urged a transition to "post-quantum cryptography" (PQC) immediately.

Related: Google reveals major 2029 quantum threat for digital wallets