JPMorgan Chase preparing for a quantum world, just in case
JPMorgan Chase has been looking into how quantum computing would impact the financial services space, and even though a general-use machine is still many years off, the company's quantum computing quantitative researcher Nikitas Stamatopoulos said it is important to be prepared.
For the last couple of years, JPMorgan Chase has been a part of the IBM Q Network, which is Big Blue's initiative aimed at advancing quantum computing.
"It has allowed us to look into some problems … to determine essentially how this could work out for financial institutions just like JPMorgan Chase and it's been very exciting," Stamatopoulos said, presenting at IBM's Think Digital 2020 conference.
He said JPMorgan Chase has a lot of computationally hard problems that form important parts of its business, and that the proposition of quantum computing could potentially allow it to solve them at scale.
"The astounding progress at the hardware level during the last decade or so kind of brought us to a point where we started thinking, there might be something there, it's probably a good idea to get into it sooner rather than later so we can see what it means for us," he said.
"So if it means something, we're ready to take advantage of it and if it doesn't, we need to know that as well."
Stamatopoulos said joining the IBM Q Network was a great opportunity for JPMorgan Chase to start sinking its teeth in. It also allowed the company to learn from other industries.
"It's a new world and we don't really know what to expect in some cases … the surprising aspect of this approach for us is that we really have to rethink the problems that we're solving in a completely different manner to think about whether quantum computing can have an impact," he explained.
"The error mitigation we recently used in our option pricing actually came from chemistry, it was part of the chemistry paper -- one challenge that we have … our world is classical, in finance we deal with financial data which is completely classical, prices and distributions and things of that sort and it's always a challenge to represent and manipulate that data directly as a quantum state.
"It also opens up opportunities that once you're able to represent them, you can operate on them in kind of like an aggregate manner more efficiently -- it's a little bit of both a challenge and an opportunity.
Calling it "mind-boggling", Stamatopoulos said JPMorgan Chase's quantum research might also force it to rethink its classical approach, given what the quantum world could teach it, with lessons able to be learned both ways.
"It really forced us to understand the ways were solving classical now, and really understand every little detail if we were to come up with a way to do this quantum leap."
Being one of the first financial services-focused members in the IBM Q Network also allows the company to shift the research and development towards a finance perspective.
"We're now in a position where we can kind of direct this area of research … push it towards a path we think is useful," he said. "Us being there at this particular point kind of helps us shape this direction."
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