Here's a fun thought experiment.
Every piece of encryption protecting your portfolio companies — the banking infrastructure, the client data, the transaction security — has an expiration date. We just don't know the exact day yet. Somewhere between 2028 and 2032, give or take a breakthrough.
That's not my opinion. That's the timeline from the National Institute of Standards and Technology (NIST), the people who literally write the cryptographic standards. And the reason it has an expiration date is quantum computing.
When you spend enough time in deal rooms, you develop a sense for when a technology crosses from "interesting whitepaper" to "material risk factor." Quantum computing crossed that line. Most of finance just hasn't updated the diligence checklist yet.
Quantum Computing, Explained Like You're at a Bar
Classical computers — the ones you're reading this on — think in bits. Zeros and ones. Yes or no. Like a light switch.
Quantum computers think in qubits. A qubit can be zero, one, or both at the same time until you look at it. It's like asking your friend where they want to eat dinner and they say "everywhere and nowhere" until you actually get in the car.
This sounds useless. It is spectacularly not useless.
Because when you chain enough of these indecisive little particles together, they can solve problems that would take a classical computer longer than the age of the universe to crack. Problems like breaking RSA encryption. Simulating molecular behavior for drug discovery. Optimizing financial portfolios in ways that make your current Monte Carlo simulations look like a kid with an abacus.
The technical term for this is "quantum advantage." The practical term is "oh no."
Follow the Patents, Follow the Money
Here's where my brain went from "huh, interesting" to "wait, this is an investment thesis."
Global quantum computing patent filings increased fivefold from 2014 to 2024. Over 5,000 were filed in 2023 alone. Q1 2025 investment in quantum exceeded $1.25 billion — a 128% jump from Q1 2024. Total 2024 funding hit $4.4 billion.
And the big players aren't messing around. IBM holds 2,500+ cumulative patents. Google filed 168 in 2024. IonQ amassed over 1,000 IP assets. Together, IBM, D-Wave, and Northrop Grumman controlled 88% of all quantum computing patents last year.
If you've ever done M&A due diligence, those concentration numbers should make your freedom-to-operate antennae twitch. This is the kind of patent landscape that produces licensing bottlenecks, cross-licensing standoffs, and very expensive phone calls with IP counsel.
McKinsey projects quantum tech could reach $97 billion by 2035. The more interesting number? Quantum computing in financial services alone went from $0.3 billion in 2024 to a projected $6.3 billion by 2032. That's a 46.5% CAGR. For context, I get excited about 15%.
The Part Where Your Encryption Stops Working
Remember Shor's algorithm? No? Good, because most people don't, and that's the problem.
In 1994, a mathematician named Peter Shor figured out that a sufficiently powerful quantum computer could factor large numbers exponentially faster than any classical computer. This is a big deal because RSA encryption — named after Rivest, Shamir, and Adleman, three cryptographers who probably didn't expect their life's work to have an expiration date — relies on the assumption that factoring large numbers is really, really hard.
Quantum computers make it not hard.
We're not there yet. Current machines don't have enough stable qubits to break RSA-2048. But the roadmap says "cryptographically relevant quantum computers" arrive between 2028 and 2032. NIST has already standardized post-quantum cryptographic algorithms. The U.S. government is recommending migration from RSA within 5-10 years.
If you're an investor, this means every company in your portfolio that handles sensitive data — so, all of them — has a quantum-readiness question coming their way. If you're doing diligence on a fintech acquisition, "what's your post-quantum cryptography migration plan?" is about to become a real question in the data room.
I know. I didn't want it to be true either.
The Geopolitical Chess Match Nobody Talks About
China holds approximately 60% of all quantum technology patents globally, backed by $15 billion+ in government investment. But here's the twist: China's patents concentrate in quantum cryptography and communication, not hardware.
The U.S. dominates quantum computing hardware patents. The USPTO grants 91.22% of quantum computing patent applications. U.S. companies hold 46% of European quantum patents.
So we've got a situation where one country owns the locks and the other owns the keys. If that doesn't sound like a geopolitical thriller waiting to happen, you haven't been paying attention to semiconductors.
Europe, meanwhile, is doing what Europe does best: writing large checks across multiple countries and hoping coordination happens. The EU Quantum Flagship is €1 billion. The UK committed £3 billion. Germany €3 billion. France €2.2 billion. That's a lot of euros pointed in roughly the same direction.
India allocated around $750 million to $1 billion through its National Quantum Mission, which sounds respectable until you realize it's about 5% of China's investment. India's quantum market is projected to grow from $1 billion in 2024 to $7 billion by 2032 at 27% CAGR. Interesting, but not yet where the patent concentration is.
What This Means if You Write Checks for a Living
I'll be honest. Six months ago, I would have filed quantum computing under "things that are probably important but not my problem yet." Now it's firmly in the "things that are definitely important and becoming my problem faster than I'd like" category.
Here's the short version for anyone allocating capital:
The patent landscape is consolidating fast. IBM and Google jointly hold 87 U.S. patents just in quantum error correction — the one technology everyone agrees is the gatekeeper to practical quantum computing. If you're investing in any quantum startup, freedom-to-operate analysis isn't optional anymore. It's existential.
Financial services is the most active application domain, with 250+ patents and every major bank from JPMorgan to Goldman Sachs to HSBC running quantum algorithm programs. If you're in fintech M&A, the quantum capabilities of an acquisition target are moving from "nice to have" to "material risk factor."
And post-quantum cryptography migration is not a hypothetical. It's a compliance timeline. Every portfolio company touching encryption is going to need a plan, and the companies selling that plan are going to be very busy.
A Final Thought
I've watched enough technology cycles to know the pattern. First the physicists get excited. Then the patent lawyers get busy. Then the capital starts moving. Then everyone in finance scrambles to catch up.
We're somewhere between steps two and three. The hardware isn't ready for primetime. But the patents are being filed. The standards are being set. And $4.4 billion doesn't flow into a sector because people are feeling generous.
The window between "early mover" and "playing catch-up" is closing faster than most people think.
Emmanuel runs Ninth Square Capital, where he advises on M&A, capital markets, and emerging technology strategy. He did not understand superposition before writing this article. He's about 70% sure he understands it now. Possibly 30%. Both at the same time.
Read time: 5 minutes
Research papers skimmed: More than I'd like to admit
Qubits personally entangled: 0, thankfully
Encryption anxiety acquired: Significant