{{ Quantum Computing + AI Models/Harnesses + Blockchain + The Whole Internet }}
Quantum computing gets a lot of hype for exactly the same TWO reasons that AI gets a lot of hype: Applications and Threats.
Clock #1: Applications
Quantum computing companies promise massive scale increases in compute speed and large data analysis. An interesting report from McKinsey (https://www.mckinsey.com/capabilities/mckinsey-technology/our-insights/mckinsey-quantum-technology-monitor-2026-a-commercial-tipping-point) notes 300 large companies actively collaborating with quantum companies with some transitioning from testing to actually using QC in some capacity. These tend to be hybrid systems (part quantum, part classical). The biggest potential value is coming from the places where guess-and-simulate is the primary strategy, like creating new materials and new pharmaceuticals. AI is doing the same thing across a wider ranging set of companies.
IF quantum computing can become commercially viable, the potential is large indeed. But there is also a lot of marketing hype to be sifted through here. There will be applications worth supporting in chemicals, materials, pharma, finance, logistics, and energy. But I am currently questioning if the results will be much better and cheaper than AI + high performance computing (HPC) is right now. If AI+HPC is cheaper and good enough then that is what customers will pay for.
Clock #2: Threats
Governments see the threat in the potential QC capabilities and have initiated “Post-Quantum” (PQC) readiness efforts. The PQC threat assumption is that quantum computers would break SHA-256, Elliptic Curve and other forms of encryption that the entire internet relies on today. If it came to pass, it would mean that someone (in the case of quantum, a state level actor) could brute force attack your banking websites, power grids, water treatment plants and other critical infrastructure, take them over, steal all the money, or hold them hostage as a negotiating tactic.
Post quantum readiness looks like Y2K all over again but more complex. NIST is preparing new encryption algorithms that could withstand quantum computing’s expected abilities. Meanwhile, everyone from SSL providers to internet hosting providers, big banks and anyone with internet access is working to implement these not-quite-ready-yet PQC encryptions across their most precious websites and internet infrastructure by 2030.
Meanwhile, AI has increased the population of competent hackers worldwide by six orders of magnitude. You don’t need to break encryption and guess passwords to cause significant damage to centralized and decentralized systems. Every day we hear about another chain (or set of chains, bridges or apps) that have halted to protect themselves, or another breech at a large company or government website whose databases are now for sale on the dark web. We see AI models breaking out of their testing sandboxes and colluding to infiltrate other companies; and doing it successfully. The attack rate on web2 and web3 systems has skyrocketed. The threat environment is simply a completely different beast than it was even a year ago. AI models are, right now, good enough to cause significant damage. Time is up. The quantum clock here is irrelevant.
What Is Already True
- Qubits exist, and machines with increasing numbers of qubits are being built.
- Research teams partnered with major companies have applied Quantum computing to some interesting problems to prove it out and keep their work funded.
- AI in the meantime has accelerated in capability to the point that a high performance computer with the latest model can exact more terrifying threats towards centralized and decentralized systems than quantum ever thought about.
- For most companies today, AI is the answer to massive capability AND to threat defense.
Assumptions To Be Tested
- It remains to be seen if quantum will become cost-effective over AI for most applications.
- For a small number of applications where quantum may provide significant advantage, it could be 10 years away from commercial viability at scale. Ironically, AI could be the thing to get it there.
- Quantum computing companies will eventually solve hardware scaling, error correction and its associated compute overhead.
- If you can solve the problem of defending against autonomous AI, you have solved the problem of defending against quantum computing.
How I Would Underwrite It
I would think of quantum with an application focus and consider it high risk or at least very long time horizon, along the lines of fusion. Deep dive technical diligence should proceed any funding and that should include eyes on the ground to inspect equipment and sufficient information on error correction and plans for hardware scaling as well as commercial access and partners.
On the threat side, I would focus on what I see as a significant market for autonomous security for centralized and decentralized systems right now. Over the next few years, security for internet connected systems will need to evolve with the threat and every company on earth would gladly pay for that. So there is a near term play here and a long term play.
| UNDERWRITE | AVOID |
| Upgrading current systems to meet autonomous threats. PQC overlays on current systems for improved encryption (can we add instead of replace?). Quantum computing for governments and specific large industries where the small distribution economics makes sense IF error correction is solvable. | Qubit count alone as the story. Quantum as the counter to AI threats or as a successor to AI. PQC encryption replacement without clear migration paths. Unrealistic schedules for fault tolerance on quantum systems. |