Singapore’s Monetary Authority (MAS) issued a cautionary note to financial institutions (FIs), urging them to prepare for the potential cybersecurity risks associated with quantum computing.

In the advisory, MAS highlighted the transformative potential of quantum computers, which leverage the principles of quantum mechanics to solve complex mathematical problems exponentially faster than traditional computers.

However, the flip side of this advancement is the looming threat to commonly used encryption and digital signature algorithms, posing a significant risk to the security of financial transactions and sensitive data processed by FIs.

The advisory underscores expert forecasts that anticipate increased cybersecurity risks linked to quantum computing in the next decade.

Cryptographically relevant quantum computers (CRQCs) are expected to efficiently break widely-used asymmetric cryptography, potentially requiring larger key sizes for symmetric cryptography to maintain security.

In response to these concerns, MAS recommends that FIs attain “cryptoagility,” allowing them to smoothly migrate away from vulnerable cryptographic algorithms to post-quantum cryptography without major disruptions to their IT systems and infrastructure.

MAS also suggests the implementation of quantum security solutions such as Quantum Key Distribution to bolster cybersecurity measures.

The advisory outlines several key measures for FIs as part of their quantum transition efforts. Financial institutions are advised to stay informed about the latest developments in quantum computing, monitor ongoing quantum computing developments for potential threats, and assess IT supply chain risks arising from quantum threats.

Collaboration and information sharing are encouraged, with FIs urged to connect with industry groups, research bodies, or Information Sharing and Analysis Centres to collectively mitigate systemic quantum risks.

The importance of maintaining an inventory of cryptographic assets, identifying critical assets for prioritised migration to quantum-resistant encryption, and assessing existing system infrastructures for crypto-agility is emphasised.

FIs are also urged to develop strategies and build capabilities to address cybersecurity risks associated with quantum technology.

This includes uplifting the technical competencies of relevant staff, reviewing internal policies, standards, and procedures to align with the transition, and planning for contingencies in case of quantum-related cybersecurity risks.