Schrodinger’s chip

Flip a coin.

While it’s in the air, ask yourself: how many possible outcomes are there when it lands back in your hand?

The obvious answer, of course, is two. It could land either heads or tails.

Now take two coins. Flip them. Same question: while the coins are in the air, how many possible outcomes are there?

This time it’s four. Head head, tail tail, head tail, tail head.

The two spinning coins can represent four possible states – four different outcomes. All of them are possible. But until the coins land, they’re all just potential states.

The more coins you flip, the more potential states you have in front of you, as the possible outcomes start to interact. Three coins lead to eight states, etc.

OK. Let’s make this more interesting before you worry I’ve lost my mind. Say I take 300 coins and flip them at the same time. How many possible outcomes are there, whilst the coins are spinning in the air?

Answer: a number so large it would take me half a day to say it to you. A number larger than every single atom in the universe put together.

Congratulations! You’ve just had your first crash course in quantum computing. Remember the day. Understanding the power of quantum computing today may well help you anticipate and understand a million new developments in the coming decade or two. Today I want to explain why that is.

Back to our spinning coins. It’s a useful metaphor for understanding quantum computing. The coins represent quantum “bits” – the essential component in a quantum computer chip.

These are different to regular computer chips, like the ones in the computer I’m writing to you on, or pretty much every other computer in the world today. In a conventional computer processor the transistor is either up or down. A zero or a one. A head or a tail. It cannot be both.

It’s a coin that has already landed. Actually that doesn’t quite work, because it was never flipped. It’s a coin that has been placed either heads or tails up.

Quantum bits are different. They’re like spinning coins. While they’re in the air, they’re effectively both a head and a tail. Either outcome is still possible. Just as Schrodinger’s cat is – until you look inside the box – both dead and alive, the spinning coin holds the potential to be simultaneously one thing and its exact opposite at precisely the same moment.

Just as the spinning coin is both head and tail, the quantum bit is both zero and one. With enough bits all “spinning” and representing more than one state, you achieve incredible computer power.

Not just more power, either. Quantum computing isn’t just more powerful in the way a new generation of computers is twice as powerful as the last. It is of another scale altogether… with an entirely different set of possibilities.

By the way, it’s probably a little unfair to downplay the doubling of computer power every couple of years, known as Moore’s Law. We live in a world that has been utterly turned upside down by rapidly improving computer power. (I could riff on the changes wrought by the computer/phone/internet here, but I’m sure you get my point.)

In other words, I don’t relegate its importance by accident. I do so because quantum computers would make the smartphone look like the chamber pot.

Another rapid leap forward in technology would bring about both positive and negative changes. But until recently, it wasn’t something you had to spend much time worrying about. Traditional wisdom suggested we weren’t likely to “crack” quantum computing for decades.

So much so that when I wrote my book The Exponentialist – which is designed to be a guide to the four key technologies that’ll change the world in the coming decade – I didn’t even include quantum computing. (You can get your copy of that book by using this link, by the way.)

And then… earlier this year… something changed.

It started with big news from Google’s project to develop quantum computing. Specifically, a piece in Quanta Magazine by a writer called Kevin Hartnett. He quoted Hartmut Neven, who plays a leading role within the Google project. Neven claimed his team have made a major breakthrough in the race to develop quantum computing.

According to reports, the speed with which quantum processors are progressing is now a “double exponential”. A double doubling in speed. As Neven himself put it, with double exponential growth “it looks like nothing is happening, nothing is happening, and then whoops, suddenly you’re in a different world. That’s what we’re experiencing here.”

Neven may well go down in history in the same way Gordon Moore did: by giving his name to an exponential function that will change the world.

It was big news. It means perhaps quantum computing is closer than we think. Maybe much closer. “Suddenly, you’re in a different world…”

As you’d expect it got people talking. One note, written by John Loeffler and circulated widely here at Southbank Investment Research HQ, put it like this:

Hartnett’s piece should be a major wake-up call for the world. As we’ve plodded along, thinking that tomorrow would be more or less like today, something extraordinary appears to be taking place at Google’s Quantum AI labs in Santa Barbara, California. In December 2018, Neven and his team began running a calculation on the company’s best quantum processor when they began to see something unbelievable.

Extraordinary indeed. And in tomorrow’s issue I’m going to explore why that might be.

But before I do that, I want to give you an insight into what our own in-house experts thought of the news here at Southbank Investment Research. I thought I’d do that by publishing their private correspondence with me. Call it a publisher’s privileges.

I’ll give the floor to Eoin Treacy, investment director of Frontier Tech Investor, first. (By the way, if you like Exponential Investor you’ll love Frontier Tech Investor. It takes these ideas a step forward and provides specific investment recommendations to go with them. More on that another day.)

Over to Eoin:

The more I think about this the more excited I become.  

This is the same kind of gamechanger for the global economy as shale oil and gas was in 2005 but it is going to happen way faster. 

This is now an arms race. The reason Thucydides’s trap stalled was because of nuclear weapons. Nuclear weapons are only as good as the launch codes that control them. If those are hackable, you erase mutual destruction. So the first country with a quantum supercomputer has an untold geopolitical advantage. 

Every possible world exists right up until the one we call reality, the most likely, is created and all others are destroyed. We live in the perfect world because it is the only one that exists and therefore is the most likely. Quantum computers run the probability of what is the most likely to occur and anything that exists is the most likely because it exists. There is going to have to be a complete change in the cryptography of all codes to overcome this change. 

It also going to be interesting to see how crypto responds to this news. 

At least we already own Google. I closed our long in IBM because the share was performing badly. It may be worth buying it back.  

Quantum power on the scale they are referring to in the article will lead to exponential growth in solving for fusion, drug discovery, materials science, genetic sequencing, brain mapping, autonomous vehicles, etc.

In the financial markets it will lead to predicative models for prices that make high frequency trading look like Lego. 

I’m going to pick a few of those threads back up again tomorrow.

But before that, I’ll share what Sam Volkering – editor of Revolutionary Tech Investor – had to say. Sam is best known by many readers as a crypto expert. But that mischaracterises him. Sam is interested in profiting from disruptive change. Crypto is one manifestation of that. But it’s not the only one.

His views, in response to Eoin’s note:

Isn’t the idea of quantum supremacy moot? If only one player has a quantum computer, then sure, they have the keys to the vault.

But much like the moon landing, more than one country or company with quantum capability = a good old-fashioned arms race.

Which if that’s the (likely) outcome then you’re bang on, we’re talking about a new golden age of tech development – doubly exponential growth in what we know, can do, can achieve.  

The last 50 years have been a wealth generation event rooted in the microprocessor and semiconductors and the extrapolation of what that technology can do. Now picture that again, to the power of infinite and over a faster timeframe. 

Sam’s comparison to nuclear weapons is interesting. Is a quantum-armed Silicon Valley more powerful than a nuclear-armed US government? Your thoughts welcome at

Sounds silly… but the US is a very divided place…

More tomorrow…

Nick O’Connor
Publisher, Exponential Investor

Category: Cryptocurrency

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