The White House held a quantum innovation summit on Tuesday, and the crowd was so packed that one attendee called it "standing-room only" with well over 100 people joining. IBM, PsiQuantum, D-Wave and Quantinuum told POLITICO they were among the companies present. The message was plain enough: Washington is lining up the state, the Pentagon, and the private sector around a technology race that ordinary people will be expected to pay for, fear, and eventually live under.
Who Has the Power
The summit came after a burst of federal activity. In May, the Department of Commerce announced it plans to provide more than $2 billion in incentives to support nine quantum-focused companies. In late June, President Donald Trump signed two executive orders aimed at boosting quantum development and preparing federal systems for quantum-enabled cyberattacks. One of those orders said information from the Quantum Benchmarking Initiative will also inform how the government builds out supply chains for quantum computer hardware. The apparatus is moving money, setting priorities, and deciding which firms get the fuel.
The Quantum Benchmarking Initiative, or QBI, is a Defense Advanced Research Projects Agency program to determine whether it would be possible to build an industrially useful quantum computer by 2033. The initiative is specifically examining the feasibility of building "utility-scale, fault-tolerant quantum computers" — machines that are cost-effective and can operate despite computational and hardware imperfections. A DARPA spokesperson said, "QBI’s goal is to provide the U.S. government with the best possible assessment of the current state of commercial quantum computing and its likely trajectory, so that those stakeholders can make informed decisions. ... While not guaranteed, QBI estimates that on balance, it is more likely than not that at least one company will be able to create an industrially useful quantum computer by 2033."
Joe Altepeter, the founding program manager of QBI, said during a December conference that the agency is fully prepared to accept that developing an industrially useful quantum computer won’t be possible in the next seven years. "Our job is to prevent surprise and give ground truth to the U.S. government to make wise decisions," Altepeter told the crowd at a December quantum industry conference. "And we are perfectly fine if the answer is: ‘No one’s going to be able to build this. We should spend our money building giant robots or curing cancer instead — don’t worry about quantum computing.’"
Who Pays for the Race
The summit attendee said QBI was a major topic of discussion, with Undersecretary of Defense Emil Michael attesting to its rigor in particular. A White House official said QBI will inform the Defense Department’s efforts to bolster supply chains and its understanding of quantum computing. The official added that the June executive order focuses on developing scientifically useful quantum technology in the near term, while QBI is assessing long-term commercial viability. The Pentagon did not respond to an inquiry.
Paul Lekas, the Software & Information Industry Association global public policy and government affairs head, said the U.S. quantum effort would likely keep momentum even if QBI concludes the 2033 timeline isn’t feasible. "You’re going to continue to see interest … because of all the potential applications as well as the concerns that if the United States doesn’t get there first, we are potentially vulnerable to what potential adversarial actors can do with those capabilities," Lekas told DFD. "I don’t think you’re going to see scientists and the private sector and government say, ‘OK we’re going to pause what we’re doing right now and wait.’"
David Bernal Neira, a Purdue University chemical engineering professor who studies quantum, said there’s a general consensus that building such a computer is possible — it’s just a matter of when. "I see [QBI] as an accelerator and as a field for an already ongoing competition to happen, whether or not the goals are achieved by the deadline that has been set," he told DFD. "If this goalpost of 2033 is not achieved, I still think that we will be at a stage that is much, much closer than where we are right now."
Neira also said supply chains may need to be tailored to whichever approaches QBI determines to be viable, noting that some approaches rely heavily on lasers while others require more cooling equipment or helium. "When you go into the question of what it means for them to be at the utility scale … that’s a supply chain question," he said.
Crypto Under the Gun
Reuters reported that the cryptocurrency industry is starting to prepare for the threat of quantum computing as recent advances fuel concerns that the technology could soon be able to crack the cryptography that protects transactions and digital wallets. The report said quantum computers can solve complex mathematical problems much faster than today's sophisticated computers and could be used to unscramble conventional methods for encrypting digital information. It said that spells trouble for the $2 trillion global cryptocurrency market, which is based on blockchains secured by old-school cryptography and already has a history of major hacks.
The Reuters report said crypto industry concerns have grown since March research from Alphabet's Google suggested quantum computers may be able to break that cryptography sooner than previously expected, according to executives and analysts. Google has said that quantum computers capable of breaking encryption could arrive by 2029, whereas previously they were seen as at least a decade out. Recent research from Citigroup and others has also concluded that quantum computing, along with artificial intelligence breakthroughs, has compressed the time frame in which cryptocurrencies will become widely vulnerable to hackers.
Donald Trump last month issued executive orders to bolster U.S. quantum capability. Some crypto companies and blockchain developers are already drawing up plans to upgrade their networks with quantum-resistant cryptography, a potentially years-long effort that could require sweeping changes to the infrastructure underpinning digital assets. Chris Tam, head of quantum innovation at BTQ Technologies, which focuses on quantum security, said, "It's the most direct and existential threat towards cryptocurrencies and crypto networks."
The Reuters report said most blockchains rely on decades-old elliptic-curve cryptography to generate the public and private keys and digital signatures used to verify ownership of crypto assets and authorize transactions. Public keys are mathematically derived from private keys and, in many blockchain networks, become publicly visible once crypto assets are used in a transaction or transferred. While conventional computers cannot feasibly derive a private key from a public key, a sufficiently powerful quantum computer could potentially do so, allowing hackers to forge digital signatures and authorize fraudulent transactions. That is a particularly acute risk for public crypto networks where transactions, unlike traditional payments, are irreversible.
Utkarsh Ahuja, managing partner at Moon Pursuit Capital, a crypto investor, said, "Crypto especially is uniquely exposed because blockchains are transparent and permanent." Bitcoin, the biggest cryptocurrency, is considered particularly vulnerable because its 17-year history of transactions has generated a large number of visible public keys. Roughly 35% of the token's circulating supply could be exposed to a quantum computing attack, according to an unpublished June 2026 working paper by independent researcher Ahmed Raza Muhammad Umer. Other research from last year has estimated that figure could be as high as 50%.
Cristiano Ventricelli, vice president and senior analyst of digital assets at Moody's Ratings, said just one incident in which a hacker steals and sells a large amount of a token could tank its price. "Everyone will feel the impact," he added. Christopher Wood, the closely tracked global head of equity strategy at Jefferies, removed a 10% bitcoin allocation from his model portfolio in his January newsletter because of the long-term "existential" threat of quantum computing.
Many crypto executives believe it will still be a few years before quantum computing can crack blockchains and that the industry will be able to upgrade to new post-quantum types of cryptography resistant to the technology. But they also warned that moving too early could create vulnerabilities because post-quantum cryptography is still rapidly evolving. Post-quantum digital signatures are generally much larger than traditional signatures, increasing storage and bandwidth requirements. They could raise costs and degrade user experience, particularly on blockchains with fixed block-size limits, such as bitcoin, said Zach Pandl, head of research at crypto asset manager Grayscale. He added, "There is an engineering challenge ahead, but there are engineering solutions already on the table."
One senior cybersecurity executive at a major crypto player said he expects it will take two years for his company to become fully quantum-resistant. He and others described the potential work as akin to a Y2K-style overhaul when more than $300 billion was spent globally fixing the "millennium bug." The problem is especially thorny for blockchains, which are mostly decentralized, meaning they are operated by a community that may not be able to agree on a path forward, said Tam of BTQ Technologies.
None of the top 20 blockchains have implemented a post-quantum signature algorithm, according to people interviewed for the Reuters story. In the case of bitcoin, developers and market participants are divided over which fix to adopt and when to move, executives said. The Ethereum Foundation, which supports the blockchain that underpins ether, the second-largest cryptocurrency, says it is targeting 2029 for full protection from quantum computing. Christopher Smith, CEO of Quantus, a blockchain that already uses post-quantum cryptography, said, "The sort of disaster scenario is that it happens way sooner than we think."
The Algorand Foundation, which supports the Algorand blockchain, whose native token has a market capitalization of around $780 million, is among the early movers. It last month published a post-quantum roadmap and plans to start supporting post-quantum accounts later this year, said Bruno Martins, Algorand Foundation's chief technology officer. "It felt right to start doing (something) now, because it's responsible to have a plan," Martins said.
Europe Funds the Next Factory Tool
In Europe, TechCrunch reported that QuantumDiamonds, a German startup that applies a novel approach to inspecting chips, has received EU backing. With the approval of the European Commission, it has been granted €76 million in non-dilutive funding provided by Germany’s federal economy ministry and the state of Bavaria. The startup will use it to set up a new facility for the production of semiconductor testing equipment in Munich as part of a $178 million investment plan it had already announced.
QuantumDiamonds is a spinout from the Technical University of Munich, and TechCrunch said it has also raised a €15 million equity round led by VC firm World Fund. The company declined to disclose its valuation, but said the round was also backed by Bayern Kapital and existing investors including Creator Fund, Earlybird, First Momentum, IQ Capital, Onsight Ventures and UnternehmerTUM. CEO Kevin Berghoff said raising the round was a fairly quick process because QuantumDiamonds was able to demonstrate customer pull. "We work with almost everyone in the chip ecosystem," he said.
Berghoff said the company compresses a defect detection process that usually takes weeks into a two-minute inspection that doesn’t stop production lines, and claims it can help the likes of Taiwan-based Foundries and Korea’s Memory Makers save hundreds of millions of dollars. He said the hardware is typically paid back entirely within a couple of months. The startup also charges a subscription fee for on-site support and for its software, which interprets the data and usually gives clients a strong indication of what they should address in their manufacturing process.
Berghoff said quantum sensing is already operational in its ability to generate magnetic fields that detect defects with high precision. "They couldn’t care less about it being quantum," he said with a laugh. He said QuantumDiamonds uses synthetic diamonds and their tiniest properties to observe how electricity is flowing through chips. Compared with current inspections, which look at the top layer of a chip with a microscope of sorts, this approach can detect defects through all layers without destroying the chip.
Berghoff said the capability could be particularly relevant as chips are increasingly multi-layered. Startups such as Semron have been developing 3D chips, and the industry seems to agree this is the way to go for AI data centers, he said. "The thing is that the transistors cannot get smaller, so in order to get the same power and the same compute, you start to add more and more layers."
He said large competitors including "100 billion market-capped U.S.-based inspection companies" will likely adapt at some point, but QuantumDiamonds has first-mover advantage. "There is no U.S. or Asian company that has shipped those tools," he said. The startup is already out of the lab and on its way to moving from its clients’ labs to their fabs, the semiconductor manufacturing plants. "What we have now is a tool for a lab environment, where you do sample-based testing, and test maybe one out of a million chips," Berghoff said. "What we now aim for is to also do high-throughput testing, meaning you can do 100% quality control in the fab itself."
Berghoff said the machines are costly, with the lab tools in the single-digit millions and the high-throughput system potentially up to $10 million to $15 million, though still far below ASML machines that cost maybe $400 million. Daria Saharova, World Fund managing partner, wrote in a statement that QuantumDiamonds "can become Europe’s next ASML." Berghoff said ASML also wants to do more in inspection and could buy the startup at some point, although ASML said recently it isn’t too keen on M&As.
Berghoff said QuantumDiamonds may be more akin to IQM, the Finnish quantum spinout that recently went public. He said both companies come from Europe’s deep tech breeding ground and aim to leverage European support and funding to go global. QuantumDiamonds opened a regional hub in Taiwan and completed its first commercial deployments both in Taiwan and in the U.S., where it installed a system at Eurofins EAG Laboratories in Sunnyvale, California.
The new funding will also generate jobs in Munich, where most of QuantumDiamonds’ team of 70 people is based. Berghoff and his co-founder and CTO, Fleming Bruckmaier, plan to double the engineering team over the next 12 months, taking advantage of affordable talent with both quantum and semiconductor expertise. "We have what we need here to ship overseas," Berghoff said.