A Quantum Act: Europe as the world's tech hub

With the post-1945 world order in retreat, Europe is faced with the challenge of re-defining its principles and geostrategic direction on the world stage.

The Americas, increasingly dominated by the might of the United States, is pursuing an agenda of financial and climate deregulation to power economic growth – with mixed results. In Asia, China is leaning into its soft power, and commanding key resources, such as rare earth minerals, which are the foundation of the AI revolution.

Europe, meanwhile, is not known for its relaxed approach to regulation. Its bureaucratic inclinations are leading to unfulfilled economic potential, and its key middle powers are increasingly finding themselves muscled out of geopolitical machinations. In this brave new world, Europe’s raison d'être should be to become world’s technology and innovation hub. Indeed, the skills, expertise, and finance are already here.

The upcoming European Quantum Act is one of the most promising lunges in this direction. A legislative initiative due to be launched during the second quarter of 2026, it is designed to establish the European Union (EU) as a global leader in quantum technology. The Act looks to coordinate research, boost industrial capacity for quantum technologies, and secure new supply chains. Crucially, some of the key commercial applications of this research will find a home in Europe’s financial sector.

The principles of quantum computing

Modern physics is comprised of two spheres: that of the laws governing very large scales – such as the movement of celestial bodies, solar systems, and galaxies – and that of the principles governing infinitesimally small scales, such as the behaviour of electrons, protons, and neutrons.

Characterising much of the thinking around the former sphere was Einstein, with his early 20th century theories of general and special relativity. These theories were quintessentially classical and deterministic. Quantum theory, on the other hand, which describes interactions at very small scales, is inherently probabilistic. It shows that at the sub-atomic level, particles (or quanta) have a duality, meaning they can act as both waves and points in space, and can even travel backwards and forwards in time.

While this may read as the stuff of science fiction, the maths that underpins quantum mechanics makes incredibly precise predictions. In fact, it is one of the most robust theories in modern science.

Inevitably, theoretical physicists need experimental physicists to apply this knowledge – not least to satiate the investors. A key use case for quantum mechanics is found in computing. By harnessing the tendency of sub-atomic particles to be in more than two places at once – i.e., in a superposition – the fundamental, binary language of computers is cleaved open. If engineers can successfully swap classical bits with quantum bits (qbits), computational power will grow exponentially – enabling us to solve problems far beyond the comprehension and capacity of today’s technologies.

From theory to application

Tasked with focusing this potential is the European Quantum Act. It builds on the Quantum Strategy, adopted in July 2025, which serves to implement binding regulations and introduce new standards for certification, interoperability, and cybersecurity for quantum devices.

The latest Act, slated to go live in Q2 2026, has four key goals:

1. Coordinated investment – to avoid a fragmentary approach by aligning research and innovation across the EU

2. Increased industrial capacity – to establish a Euro-Quantum Joint Undertaking to boost the creation of quantum startups and facilities

3. Tech security and sovereignty – to develop quantum-safe cryptographic standards and protect European intellectual property

4. Infrastructure and skills – to found a quantum skills academy and develop made-in-Europe tools

Most importantly, the Quantum Act is underpinned by an application-driven strategy, which looks to push high-level research into the commercial space, via quantum-based technologies.

Quantum-powered financial services

Though quantum computing will likely be predominantly applied to defence and space, the financial services industry is already brainstorming some use cases.

In October 2025, the UK’s Financial Conduct Authority (FCA) issued a research note titled, Quantum Computing Applications in Financial Services. The FCA acknowledged the continued advancement of quantum technologies, and “the need to understand what their deployment could mean for financial markets, consumers, and the UK’s position as a global financial centre.”

UK Finance has also waded into the debate, arguing that “quantum computing presents a unique opportunity for the UK's financial services sector as it seeks to harness new innovations and assess emerging technologies.”

The capabilities referred to will likely include processing vast, multi-dimensional datasets to optimise portfolios, enhance fraud detection, and supercharge risk modelling. This would mean greater investment gains, accelerated regulatory compliance, and next-generation cybersecurity protocols, among other things.

The World Economic Forum, Cambridge University, McKinsey, the Bank for International Settlements, Lloyds, HSBC, and many other entities have recently published their thinking on the potential of quantum computing in finance.

HSBC, for instance, unveiled in September 2025 the world’s first-known empirical evidence of the potential value of quantum computers for solving real-world problems in algorithmic bond trading. Working with a team from IBM, the bank utilised a combination of quantum and classical computing resources to deliver a 34% improvement in predicting how likely a trade would be filled at a quoted price, compared to common classical techniques used in the industry.

HSBC argued that these results demonstrate the “value quantum computers could offer when integrated into the dynamic problems facing the financial services industry.”

A sci-fi(nance) future

The EU’s efforts in the quantum space underscore a drive to re-define its industrial niche on the global stage. With a long, influential history in science and research, Europe is seeking to tap into its expertise and spearhead the next technological revolution.

The key to success will be initiatives like the Quantum Act – serving to focus investment, and deliver the capacity, security and infrastructure needed to ensure the EU stays relevant in an increasingly multi-polar world.