In conversation with Alexandra Beckstein

Read time: 2 Minutes

Alexandra Beckstein, CEO of QAI Ventures, attended a session on “AI in Finance: Is Agentic the Endgame or just the Beginning?” on our Festival Stage. She then stayed on to answer more questions.

Alexandra, in this interview I want to talk to you about AI and quantum technology. Did you hesitate a bit when I said AI?

Alexandra Beckstein: No, not at all. I’m all for AI.

We’re here at FIBE because we see a lot of technological developments in fintech, such as AI. We are giving a lot of trust to systems that make decisions on their own. These systems are based on infrastructure that could fail as soon as quantum computers are ready to compute at scale. Can you elaborate more on that?

Beckstein: A quantum computer will break encryption that is based on mathematical operations, like RSA or elliptic curve encryption, ECC. When we look at the roadmaps from quantum hardware players like IBM, IQM, IonQ, and Quantinuum, we see that they may be stable enough to break encryption in the late 2020s.

So, AI in fintech is not your focus?

Beckstein: We don’t work with pure fintech startups. We work with startups developing quantum technology, which can be used by the financial industry.

Can you tell us more about how financial services are going to use that technology?

Beckstein: Financial services is one of the industries that will see both advantages and threats from quantum computing. It depends on when quantum computers are ready. The first impact will not be a typical use case, but rather when encryption is broken.

The positive use cases are in simulation, machine learning, and optimization problems. For example, fraud detection and portfolio optimization. These are already being explored. There are examples from IBM in collaboration with HSBC and Lloyds Bank working on early quantum use cases.

The reason they start now is not because they already get a better ROI, but because they want to build a strategic advantage. They need to learn what quantum computing can do before it is fully ready.

You mentioned both advantages and disadvantages. Can you expand on the disadvantages?

Beckstein: Like with any new technology, there are risks. The main risk is that encryption will be broken. But we already know how to address this. There are algorithms that can be implemented to protect systems.

The challenge is that this implementation has to happen across every system in a bank, in every process, and that takes time. We estimate it takes 5 to 10 years for a bank to fully implement this.

The real risk is time. We should have started already, considering that quantum computers could break encryption in the late 2020s. That is essentially tomorrow.