Daiwa Securities Group Unveils PoC Results for Quantum-Resistant Cryptography
Daiwa Securities Group, in collaboration with several industry heavyweights, has announced the successful completion of a Proof of Concept (PoC) for Post-Quantum Cryptography (PQC) within its online services.
The initiative—a joint effort between Daiwa Securities, Daiwa Institute of Research (DIR), NEC Corporation, F5 Networks Japan, and DigiCert Japan—aims to bolster the security of internet communications against the eventual capability of quantum computers to crack traditional public-key encryption.
As quantum development accelerates, financial institutions handling sensitive client data are facing a critical window to upgrade their infrastructure. The results of the PoC, now detailed in a comprehensive white paper, highlight several key takeaways for the industry:
- Performance Stability: The PoC found that the increase in processing time for key exchanges during internet communication was relatively limited. However, the larger key sizes inherent to PQC led to an increase in data traffic and packet counts, signaling that firms must evaluate bandwidth capacity in restricted network environments before full-scale adoption.
- Phased Standardization: While the industry is moving toward PQC, the report notes that standardization for certain encryption processes is still a work in progress. Daiwa suggests a phased migration strategy that aligns with evolving international standards.
- Strategic Governance: The study emphasized that because modern financial systems utilize multiple encryption layers, a holistic approach is required. The researchers recommend establishing specialized migration teams and creating a centralized "encryption ledger" to track where and how various protocols are used across the enterprise.
Strategic Partnerships at a Glance:
- Daiwa Securities Group & Daiwa Securities: Handled risk management, policy formulation, and operational impact testing.
- Daiwa Institute of Research: Led the technical execution, scenario creation, and authored the white paper.
- NEC & DigiCert: Provided specialized technical oversight, international standardization expertise, and Public Key Infrastructure (PKI) knowledge.
- F5 Networks: Supplied the PQC-ready Application Delivery Controllers (ADC) necessary to support next-generation network infrastructure.
By finalizing this roadmap, Daiwa Securities Group signals its intent to lead the Japanese financial sector in "quantum-proofing" its digital assets. The group plans to use these findings to establish a formal policy for PQC implementation, ensuring long-term system stability and customer trust.
The full white paper is available for industry review on the Daiwa Institute of Research website.
Norbert Gehrke
