KPMG: Quantum Computing Becomes a Major Challenge in the Next 3-5 Years
KPMG is a global professional services network with a history dating back to the late 19th century. As one of the "Big Four" accounting firms, KPMG has a strong reputation for audit, tax and advisory services. With offices around the world, the firm serves a wide range of industries, including finance, technology, consumer goods and healthcare.
With the advancement of globalization and the rapid development of technological innovation, KPMG continues to expand the boundaries of its services, and is particularly active in the exploration of digital transformation and emerging technologies. In particular, in areas such as artificial intelligence, big data analytics and quantum computing, KPMG is working with clients to explore how these technologies can bring about profound changes to traditional industries. At the same time, KPMG is also delving into the broad prospects of applying these cutting-edge technologies within the auditing and consulting industry.
Among the many emerging technologies, quantum computing, with its potentially huge computing power and transformative impact, has become a focus of KPMG's attention.
The quantum wave is coming! KPMG Explains the Future Business Landscape
Quantum computers incorporate the exotic behavior of quantum physics into the computational realm, introducing unprecedented new capabilities to traditional programming methods. It shows great potential to transform drug research, energy applications, manufacturing, cybersecurity and communications, while also emerging as a harbinger of a new reality in areas such as augmented artificial intelligence applications, self-driving car navigation and financial modeling.
KPMG in the latest release of the point of view article detailed how quantum computing subverts the security architecture of the future digital economy and promotes multiple areas of advanced technology. The article states, "The quantum computing revolution is moving rapidly towards us, a paradigm shift in computing power that uses the laws of quantum mechanics to solve complex problems that today's traditional digital computers struggle to cope with."
The emerging quantum computing industry has already made significant progress. With more and more organizations recognizing the potential of quantum computing, the global market is expected to reach $50 billion by the end of this decade. For example, large technology companies such as Amazon, IBM, Google and Microsoft are rapidly developing their quantum computing capabilities and have launched commercial quantum computing cloud services. Meanwhile, emerging companies like Quantinuum and PsiQuantum have also received huge investments.
In a survey of 250 large companies, about 60% in Canada and 78% in the United States expect quantum computers to be mainstream by 2030. Most of the surveyed companies expressed extreme concern about the possibility of quantum computing breaking their data encryption. In Canada and the United States, 60% and 73% of businesses, respectively, believe that cybercriminals use the power of quantum computing to decrypt and break existing network security protocols just a matter of time. At the same time, 62% of Canadian businesses and 81% of U.S. businesses recognize that they need to better assess their ability to ensure the continued security of data.
Protecting data and addressing cyber risks will be a major challenge for CEOs and board members in the private sector in 2024 and over the next three to five years, according to research by KPMG Australia.
And 95% of respondents to a study by KPMG Germany, conducted in collaboration with the German Federal Office for Information Security, believe that the impact of quantum computing on current cryptographic security systems is "very high or high", while 65% believe that their own data security risks are "very high or high". ". However, only 25% of companies said their risk management strategies were actively addressing these challenges.
KPMG's keen interest in quantum computing stems from the enormous potential for growth in this area and the revolutionary changes it could bring to financial, consulting and auditing services. Quantum computers, with their ability to transcend traditional computing boundaries, offer unprecedented solutions to complex problems.
In the financial services sector, the use of quantum computing is expected to dramatically improve the speed and accuracy of data analysis and risk assessment. KPMG, a global provider of financial audit, tax and advisory services, is very interested in this. Quantum technology will empower them to analyze large data sets more quickly and accurately, and thus provide a higher level of client service.
Similarly, in the area of consulting and audit services, the power of quantum computing provides KPMG with novel tools and methodologies. This cutting-edge technology facilitates more sophisticated data modeling, predictive analytics, and deeper insights for clients in an intricate economic environment.
In addition, KPMG recognizes the great potential of quantum computing in solving some of the long-term thorny problems in areas such as optimizing supply chain management and enhancing cybersecurity.
Dr. Michelle Mosca of the Institute for Quantum Computing at the University of Waterloo noted, "Quantum computing is expected to revolutionize the security foundations of the digital economy, and overall, quantum technology is expected to spark disruption in a wide range of high-end technologies and bring unprecedented capabilities to improve the lives of people across the globe."
As quantum technology matures, KPMG looks forward to utilizing this emerging technology to strengthen its service capabilities and provide innovative solutions to its clients. KPMG notes that the new risk environment created by quantum computing involves a number of key areas:
- Web browsing
- Remote access
- Software
- Digital signatures
- Communications
- Cryptocurrency
For every organization that processes and stores data, it is critical to consider the lifecycle value of the data used and the potential impact of its misuse by bad actors.
- Sensitive Organizational Data: This includes highly classified information held by military authorities, national intelligence services, financial and government agencies.
- Critical Infrastructure Providers: These are organizations whose complex systems are critical to the functioning of communities, cities, provinces, and even entire nations, spanning areas such as healthcare, transportation, utilities, and telecommunications. As an example, if quantum technology interferes with the operation of a city's extensive power grid, it could lead to serious consequences.
- Long-life infrastructure providers: organizations that provide long-term profitable systems such as satellite communications, payment terminals, Internet of Things (IoT) sensor networks and transportation systems. Whether it involves customer information, medical records, or confidential government data, a breach of this information could result in serious financial loss, reputational damage, and legal liability. Some organizations may not yet realize that hackers are already secretly accessing and storing their encrypted data, ready to decrypt it in the future using quantum computers.
- Processors of personal data: Organizations that handle long-term confidential data, such as governments, medical institutions, financial companies and insurance agencies, are required by law to protect this information, often for periods of 5, 10, 20 years or more.
Mosca's Theorem, which sets out the timeframe required to protect data, Dr. Michele Mosca emphasizes the need for organizations to immediately begin applying diligence measures in the post-quantum era. The theorem states that the amount of time that data must remain secure (X), plus the amount of time required to upgrade encryption systems (Y), is greater than the amount of time that quantum computers are capable enough to break encryption (Z)
Therefore, it is important for organizations to not only prepare for quantum threats in their long-term risk planning, but also to strengthen data protection measures now to minimize the potentially disruptive and costly effects of quantum technologies.
KPMG sees quantum computing as a modern industrial revolution that heralds an exciting new era.
As quantum technology comes into its own, businesses are beginning to recognize the disruptive advantages and potential threats it poses. This change has led to the formation of new legislation and regulations. For example, the United States passed a bill in 2022 requiring government agencies to adopt post-quantum cryptography and encouraging the private sector to follow suit.
Page Link:
https://www.congress.gov/bill/117th-congress/house-bill/7535
The National Institute of Standards and Technology (NIST) released two draft guidance documents in December 2023 that aim to provide direction for businesses and organizations to reshape their ability to defend against potential quantum attacks. These documents identify issues and their solutions that may be encountered when migrating to new post-quantum cryptography standards. Among the many current initiatives are:
- The Quantum Computing Cybersecurity Readiness Act of 2022, which encourages U.S. federal organizations to prepare for a post-quantum cybersecurity (PQC) world;
- The National Security Memorandum (NSM), which aims to increase U.S. leadership in quantum computing while reducing the risk of vulnerable cryptographic systems;
- White House Memorandum on "Migration to Post-Quantum Cryptography";
- Advisory guidance issued by the Monetary Authority of Singapore on addressing quantum-related cybersecurity risks;
- Quantum security in the financial sector: a collaborative project between the World Economic Forum and the Financial Conduct Authority.
A global consensus is emerging to identify the risks and requirements needed for secure quantum technologies.
While quantum computing may seem to belong to the realm of science fiction, in reality, it is about to have a profound impact on current cybersecurity capabilities. KPMG believes that innovation is urgently needed to meet this challenge.
NIST has released a draft of the NIST Cybersecurity Framework 2.0 (CSF 2.0), a major update to its Cybersecurity Framework (CSF) released in 2014 to help organizations mitigate cybersecurity risks. The framework, which is expected to be finalized and released in early 2024, reflects the latest changes in cybersecurity and provides further guidance for implementing the CSF.
Meanwhile, NIST has selected four cryptographic tools to defend against future attacks on quantum computers. These tools will be part of the NIST Post-Quantum Cryptography Standard, which is expected to be fully completed and operational by 2024.
Additionally, improvements and standards for Quantum Random Number Generators (QRNGs) for enhanced entropy and randomization and Quantum Key Distribution (QKD), a secure communication method, are also working to harness the power of quantum technology to protect data.
However, it is worth noting that current quantum solutions may only be a temporary sense of security - we are not yet sure whether quantum algorithms currently considered resistant will remain robust in the future when quantum computers are large and mainstream.The discovery of the NIST-selected cryptographic algorithm CRYSTALS-Kyber with a vulnerability is a manifestation of this risk.
KPMG's keen interest in quantum computing stems not only from technological curiosity, but is also based on the business benefits and industry changes that this emerging technology could bring. Despite the promise of quantum computing, its practical application faces many challenges. To this end, KPMG is working to overcome these difficulties through close collaboration with research institutions and technology companies.
As a pioneer in quantum computing technology, IBM plays an important role in scientific research and commercial exploration through its quantum computing platform, IBM Quantum. KPMG's collaboration with IBM focuses on leveraging IBM's quantum computing capabilities to enhance data processing and analytics, particularly in the areas of financial services and risk management.2023 In July 2023, KPMG joined the IBM Quantum Network to further explore the application of quantum computing in addressing complex business challenges.
Meanwhile, Microsoft has a presence in quantum computing, particularly in quantum software and cloud infrastructure.In March 2023, KPMG partnered with Microsoft and Quantinuum to simplify the development of quantum algorithms through a cloud platform. Since October 2023, KPMG has also been working with Microsoft to leverage the quantum-inspired optimization techniques offered by Azure Quantum to explore and solve common business problems to improve the capabilities and efficiency of their services.
KPMG is actively exploring ways to incorporate this cutting-edge technology into its business systems and emphasizes, "Our priority is to meet each client's business needs and explore use cases that will move them forward and unlock new competitive advantages, not just limited to hardware solutions that are currently emerging and showing promise."
While helping clients understand quantum computing and its potential business benefits, KPMG's team of professionals is working closely with leading organizations such as IBM and Microsoft to explore the quantum space and how it can help address today's most complex business challenges.
The prospects for widespread adoption of quantum computing are still in their infancy, and what we are seeing today is just the tip of the iceberg in terms of future potential.
This journey to the "holy grail" of computing is about to accelerate, and is expected to lead to exciting new opportunities for business and society, opening up an unprecedented era of business services. KPMG's efforts and accomplishments not only demonstrate its foresight and innovation as an industry leader, but also herald the coming era of smarter, more efficient business services.
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