Preparing for the Quantum Era in FinTech: Improving Data Security Through Unified Standards
By Denis Mandich, CTO and Co-Founder of Qrypt
As technology continues to advance in the financial sector, unified security standards have helped play a crucial role in ensuring the security of sensitive data. However, quantum computing advancements significantly threaten data security, introducing the potential for “harvest now, decrypt later” (HNDL) attacks. In these sophisticated cyber threats, adversaries exploit the vulnerabilities of current encryption methods to intercept encrypted data with the intention of decrypting it in the future using quantum computing. Unlike classical computers, quantum computers can break conventional encryption algorithms.
The advancements in quantum computing have raised alarms within the financial industry and beyond, as traditional encryption methods that once safeguarded sensitive information are at risk of being compromised. To address this imminent threat, organizations increasingly recognize the need to transition to post-quantum cryptography (PQC), which offers encryption algorithms resistant to quantum attacks. However, the transition to PQC has its challenges and complexities. The migration to PQC is expected to span 10 to 15 years.
Cross-Collaboration is Essential
One of the critical aspects of safeguarding financial data in the quantum age is the global economy. Even with borders, financial transactions can be seamless, but they require harmonized security standards to mitigate risks and ensure interoperability. However, achieving consensus on security standards can be challenging, given the diverse regulatory environments, industry practices and technological landscapes across different countries and regions.
The Accredited Standards Committee (ANSI) X9 stands out as a key player in shaping security standards and best practices within the financial industry. By bringing together industry experts and stakeholders, ANSI X9 facilitates collaborative efforts to address emerging technology challenges, including those posed by quantum computing. In anticipation of the transition to PQC, led by the introduction of new encryption protocols from the National Institute of Standards (NIST) expected to be finalized in 2024, ANSI X9 has also been actively engaged in studying the implications of quantum computing on financial data security.
Collaboration and coordination with other standardization bodies, regulatory agencies, and industry stakeholders are essential to ensuring the effectiveness and relevance of security standards in the quantum era. Collaboration with other standard bodies, such as the International Telecommunication Union – Telecoms Standardization Sector (ITU-T), is crucial to harmonizing standards across diverse industries and global regions. Additionally, international collaboration and robust education initiatives are essential given the complexities of cryptocurrency and blockchains.
Educate the Workforce
Education and awareness initiatives are also critical components of a comprehensive approach to data security in the quantum age. As quantum computing represents a paradigm shift in security threats, stakeholders must be equipped with the knowledge and skills to understand and respond effectively to these challenges.
Training programs, workshops and informational resources can help raise awareness of the risks associated with quantum threats and empower individuals within the financial industry to take proactive measures to enhance data security. These initiatives may include specialized training courses on quantum computing and post-quantum cryptography, seminars featuring industry experts and educational materials explaining the implications of quantum computing for financial data security.
Encouraging a culture of continuous learning is essential to keeping pace with advancements in quantum technology and evolving security threats. Urging employers to pursue further education, certifications and stay updated through regular workshops and seminars ensures proactive adaptation to emerging challenges and future threats.
Moreover, collaboration with academic institutions and research organizations can foster innovation and knowledge exchange in the fields of quantum computing and cryptography. By partnering with leading researchers and experts in quantum technology, the financial industry can stay at the forefront of developments in this rapidly evolving field and leverage cutting-edge solutions to enhance data security. In recognizing that quantum threats extend beyond the financial sector, collaborating with other industries facing similar challenges fosters cross-pollination of ideas, promoting collective resilience against quantum security threats. Forums, conferences or even research initiatives bring together stakeholders to share insights and solutions.
Safeguarding financial data in the quantum age requires international collaboration on robust security standards, working with industry stakeholders, and promoting ongoing employee education and awareness. By embracing these principles and working together towards common goals, integrating education, collaboration, and innovation, the financial industry can effectively mitigate the risks posed by quantum threats and maintain trust in our evolving digital economy.
