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A secure communication channel designed to protect financial data against future threats from quantum computers has been successfully established by the BIS Innovation Hub Eurosystem Centre, in concert with Banque de France and Deutsche Bundesbank.

The Bank for International Settlements bills quantum computing as one of the most significant cybersecurity threats facing the financial system today, potentially exposing all transactions and stored financial data to attack. Experts refer to that risk as “Q Day.”

To prepare for a transition towards quantum-resistant encryption, the BIS Innovation Hub Eurosystem’s Project Leap is investigating how to update and replace the cryptographic security algorithms that the financial system is critically reliant on.

The project involved transmitting test payment messages via a quantum-resistant VPN (Virtual Private Network) tunnel between servers located in Paris and Frankfurt, thereby demonstrating how critical financial data can be protected.

The BIS says the experiment acts as a blueprint for the financial system to build a complete chain of trust for central bank applications in the post-quantum world.

“While we do not know exactly when quantum computers will be strong enough to crack today’s encryption, central banks need to prepare themselves,” says Raphael Auer, head of the BIS Innovation Hub Eurosystem Centre . “Project Leap is a blueprint for how they can do so.”

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