What a crazy week it was in quantum computing.
Yesterday, The Wall Street Journal published some news that had the quantum computing industry on fire, outlining how the Trump Administration was in talks to take equity stakes in well-known quantum computing firms like Rigetti (RGTI), IonQ (IONQ), and D-Wave (QBTS).
The Wall Street Journal is not known for publishing news without confirmed sources, which is why the article was taken so seriously.
Yet, hours after the article was published, an official from the U.S. Department of Commerce denied the news, stating…
The Commerce Department is not currently negotiating equity stakes with quantum computing companies.
When I read that, the first thing I thought was… Okay, so the Commerce Department isn’t negotiating equity states, but that doesn’t mean that another branch of the government isn’t.
After the rebuke from the U.S. Department of Commerce, a Rigetti official made the following comments:
We are continuously engaging with the U.S. government on funding opportunities that advance quantum computing. If the U.S. does not lead in supporting these breakthroughs, others will.
That’s an argument I’ve been making for a long time. The competitive pressure is too great. And developing a fault-tolerant quantum computer and implementing post-quantum cryptography standards as soon as possible is a matter of national security… literally.
After seeing the Trump administration take large equity stakes in Intel (INTC), MP Materials (MP), Lithium Americas (LAC), and US Steel (now owned by Nippon Steel), is it really that hard to believe that it might be true?
All four of those investments are critical to protecting the U.S. economy and leadership in vital areas of the U.S. economy. Not having leadership in semiconductor manufacturing, rare Earth minerals, lithium, and steel would weaken the U.S. economy and result in economic fragility, not resilience.
It’s an easy argument to say that leadership in quantum computing and artificial intelligence is even more important than those four investments, as these technologies are genuinely a threat to national security.
I wouldn’t be surprised a bit if we see an announcement within the next two or three weeks or so confirming that it was all true and that deals have been done with not just three quantum computing companies, but a handful more.
Building bleeding-edge technology isn’t cheap, and the U.S. government wants to ensure that its private sector beats China in the race to a fault-tolerant quantum computer. It also doesn’t want to cede the market to big tech names like Google, Microsoft, and IBM. They are already powerful enough.
But one thing is certain, regardless of whether or not any equity stakes are taken, U.S.-based quantum computing technology companies will get the capital they need to build. The visible, tangible, and accelerated progress being made in the industry is what has excited institutional capital to lean in.
Between the latest news and the final days of Quantum Week here at The Bleeding Edge, it’s been a big week in quantum technology.
Thank you to everyone who joined me on Tuesday for my Quantum Flashpoint event, and to everyone who has been writing in, sharing in my excitement for everything happening right now with quantum computing technology.
In case you missed it, anyone curious can still catch the Quantum Flashpoint replay right here. You can hear all about what the race towards universal fault-tolerant quantum technology means for us… and what opportunities my team and I are tracking as we progress toward an era of incredible quantum-enabled advancement.
It’s happening right now.
More to follow next week, as another major announcement was just made that I’ll share with you.
Have a wonderful weekend,
Jeff
When do you expect to see photonic QAI and thin-film lithium niobate chips being commercialized and used?
– David L.
Hi David,
I’m going to guess based on your question that you might be referring to Quantum Computing Inc. (QUBT), which has been pumping its story about quantum AI (QAI) and its thin-film lithium niobate semiconductors.
If that is what is of interest to you, I definitely recommend reading the issue of The Bleeding Edge – Oracle’s Big Week. It was another AMA issue, and the relevant section is titled “GPU-based Computing vs. Quantum Computing.”
And since you’re a Near Future Report subscriber, you’ll find in your Brownstone Research account a report titled The Quantum Loser: One Popular Stock to Avoid, as another good reference.
With that said, photonic circuits and thin-film lithium niobate (TFLN) semiconductors are already being commercialized and used.
There are two companies that I really like in this space as it pertains to quantum computing. Both companies are still private companies.
PsiQuantum has developed a silicon photonics platform that takes advantage of existing semiconductor manufacturing technology. PsiQuantum is using Global Foundries to manufacture its silicon photonics chips for its quantum computing systems.
The other company is Toronto, Canada-based Xanadu, which uses TFLN semiconductors for its photonics-based quantum computing system. Xanadu partners with another private company, HyperLight, for the TFLN technology. The two companies had a big announcement this summer, which you can find right here.
TFLN, while more expensive to manufacture than something based on silicon, is a superior material to work with when referring to a photonics-based quantum computer. Compared to silicon-based systems, TFLN has very low propagation losses, very high efficiency, and a wide optical bandwidth capability. It is less mature as a technology compared to a silicon approach, so it is not without risk, but it is technologically superior to silicon for this application.
Both PsiQuantum and Xanadu are well-funded companies that are already generating revenue from their photonics-based quantum computers.
And if you want to learn more about a few small quantum companies that I particularly like for making the most of this quantum frenzy and for the post-quantum future, you can go here to catch my Quantum Flashpoint strategy session.
Any thoughts on Vanadium Redox batteries?
– Peter P.
Hi Peter,
Vanadium Redox Flow Batteries (VRFB) have been around for decades. However, they have seen limited deployments.
For everyone’s benefit, “redox” stands for reduction-oxidation. A VRFB is designed with two tanks of electrolyte fluids, as shown below. Vanadium ions change oxidation states to store or release energy.
Vanadium Redox Flow Battery | Source: CE&N
VRFBs are primarily used for large-scale, long-duration energy storage. Large-scale refers to grid-scale applications. The primary benefit of VRFBs is the long lifespan, up to 30 years.
The downside to VRFBs is that they are large, bulky, and have low energy density. They are also a lot more costly than lithium-ion battery solutions.
The ideal target customers for VRFBs are industrial-scale customers that are willing to trade off the high upstart costs for the long lifetime and low maintenance costs of these industrial-scale batteries.
Given the fairly niche target customers for this technology and the fact that VRFBs have captured less than 10% of the overall long-duration energy storage market, I just don’t see a lot of momentum for this technology.
XX
You have said many times that quantum computing can solve a problem that a traditional computer would take a zillion years to solve. So how do we know that’s actually true? How’s it measured because it’s never been solved? How do we know the answer is correct? Just questioning the methodology of the unknown.
Thanks.
– John G.
Hey John,
This is a wonderful question. And the answer is complex.
To your point, if we are just testing a quantum computer’s performance by giving it a problem that we already know the answer to, it’s easy to confirm that it is working properly. In that case, we’re just comparing a quantum computer with a classical computer and measuring how much faster a quantum computer can perform the same calculations.
But what happens if we don’t know the answer? How do we know the answer is correct?
A simplified, high-level answer is that a quantum computer can be monitored in a variety of ways to check that qubits are maintaining their superposition and entangled with one another.
If the quantum computing system, which is controlled by classical computers, can identify and correct for any errors (noise) in the system, then we can be sure that the quantum computing system is functioning properly, and the answers are accurate.
A more complex answer is that there are a variety of ways to confirm accuracy. For example, unrelated calculations for which there is already a known answer can be “hidden” within the real problem to be solved. When those calculations are correct, we can assume that the quantum computer is functioning properly.
Other methods monitor qubits to confirm that they are maintaining their entangled states. If they are not, then the assumption is that the answer is not correct.
Another method that was developed at MIT involves taking the output of a quantum computer and reversing the calculations step by step to get back to the inputs initially given to the quantum computer.
Doing so basically dissects what the quantum computer has done to get to the output. If the analysis results in the same input state of the quantum computer, we can assume that the answer is correct. If any differences are discovered in this process along the way, then we can assume something went wrong. There must have been too many errors.
Until we reach the holy grail of universal fault-tolerant quantum computers, this will be an intense area of study for the industry. And that’s precisely why so much effort is being made to develop quantum error correction technology.
Hi Jeff,
As you see in some countries around the world, the government of the UK, for example, is trying to implement a digital ID system.
To me, that is, as in a chess match, a ‘check’ on individual freedom. And if the next step of Digital Currency is implemented, that is a ‘checkmate’ on freedom. Is there any way the United States, with its current administration espousing freedom, could put in place a system that can prevent such moves by future administrations?
Thanks.
– John S.
Hi John,
This is such a depressing subject. What’s happening in the U.K. is just awful.
Yes, the plan is to roll out a central bank digital currency in the U.K., deploy a digital wallet, and link that to everyone’s digital ID.
These “BritCard” digital IDs will be required for U.K. citizens to collect their Right to Work checks and are allegedly an effort to combat the prospect of work for illegal migrants while making it easier for U.K. citizens to use vital government services.
It won’t be compulsory to have it on your person or produce it if prompted, but you also can’t opt out. And you can’t work without the ID.
And despite the U.K. government’s best efforts to position this as a net positive (It will make life easier for millions, after all! It’s a necessary measure for illegal immigration control, of course! Never mind the fundamental threat to personal and financial privacy this poses), people are understandably upset.
So many freedoms have been stripped away from British citizens, and illegal immigrants often go completely unpunished for horrific crimes.
And to your point, this latest push to “threaten” British citizens by telling them that they will not be able to work unless they accept the digital ID system is frightening. George Orwell’s 1984 was supposed to be fiction. The U.K. is making it a sad reality.
Checkmate indeed…
In the U.S., the Trump administration has already taken strong action against this. This January, President Trump signed Executive Order 14148, “Strengthening American Leadership in Digital Financial Technology.” This EO explicitly prohibits federal agencies from establishing, issuing, promoting, or developing central bank digital currencies (CBDC) within the U.S.
This was a huge victory for those of us who believe in freedom and U.S. constitutional rights. The EO also revoked pro-CBDC policies from the Biden administration (or those that were running the country at the time).
Now, the executive order has not yet been codified into law. But that is the plan. The Trump administration has firm plans to make it law within the next three years… hopefully within the next 12 months. There are currently three acts that support this initiative:
These will almost certainly collapse into one bill, which would definitely be signed by President Trump.
So that’s the answer. It must be codified into law. This is critically important to preserve our freedoms and avoid what is happening in the U.K. and other places in Europe.
It would be impossible for me to overemphasize how critically important this issue has become.
Thanks for bringing this up.
Jeff
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
