Quantum Computing Threat: SEBI Chief Emphasizes Strong Password Security and Cryptography's Vulnerability in the Coming Era

Mumbai, October 8, 2025 - Securities and Exchange Board of India (SEBI) Chairman Tuhin Kanta Pandey has issued a warning regarding the potential for quantum computing to破壞 current cryptographic systems, emphasizing the urgent need for proactive measures to secure digital systems. Speaking at the Global Fintech Fest 2025 in Mumbai, Pandey highlighted that the advent of quantum computing could render current encryption-based passwords vulnerable, necessitating a shift in how digital security is approached.

Pandey stated that research into quantum-safe computing is ongoing, but the arrival of quantum computing is inevitable. He cautioned that this could compromise conventional cryptography, which forms the basis of crypto security, potentially breaking even passwords generated through cryptography. This concern necessitates a change in how passwords are created and protected.

SEBI is preparing an "action plan" to ensure quantum readiness of all stakeholders it regulates. This plan includes discovering, preparing, and acting within the next two to four years to transition to quantum-safe cryptography. The regulator aims to have quantum-safe computing in place by 2028 or 2029.

Pandey likened the potential impact of quantum computing on cybersecurity to the Y2K challenge, where systems required adjustments as the year changed from 1999 to 2000. He emphasized that preparations are needed wherever cryptography is used for security to implement quantum-proof passwords, also referred to as post-quantum cryptography (PQC).

Quantum computers, leveraging quantum bits (qubits), possess the capability to process vast amounts of data simultaneously, solving complex problems in seconds that would take classical computers years. This immense processing power poses a significant threat to existing encryption methods.

Highlighting SEBI's commitment to innovation and investor safety, Pandey underscored the importance of embracing technology for the benefit of both the regulator and the investor community. He also mentioned that some fintech companies are already leveraging blockchain technology within SEBI's regulatory sandbox, where they can demonstrate various applications of blockchain within fintech.

While digital infrastructure has made markets more accessible, it has also equipped fraudsters with new tools to deceive investors. Therefore, ensuring the integrity and transparency of capital markets is a collective responsibility.

SEBI's Cybersecurity and Cyber Resilience Framework (CSCRF) mandates strong measures like encryption and regular audits to secure India's financial ecosystem. The framework includes mandatory quantum-safe encryption, requiring all SEBI-regulated entities to implement quantum-resistant cryptography, such as Post-Quantum Cryptography (PQC) and Quantum Key Distribution (QKD), to secure data both in transit and at rest. It also emphasizes continuous threat monitoring, requiring Security Operations Centers (SOCs) to be equipped for real-time incident detection and response, leveraging AI and machine learning to address advanced threats.

With the rise in ransomware and cyberattacks targeting financial institutions, and the looming threat of "Harvest Now, Decrypt Later" (HNDL) attacks, the urgency for SEBI-regulated entities to adopt quantum-safe encryption is greater than ever. By acting decisively, auditing cryptographic assets, adopting PQC and QKD, and building a culture of resilience, SEBI-regulated entities can secure their operations, protect client trust, and lead India's financial sector safely into the quantum era.


Written By
Aditi Patel is an aspiring journalist with a keen interest in documentary filmmaking and long-form investigative pieces, complemented by her profound passion for sports. Fresh from her visual journalism studies, Aditi is eager to explore compelling narratives through immersive storytelling. She's dedicated to in-depth research and crafting impactful content that resonates deeply with audiences, striving to give voice to untold stories on a global scale. Her love for sports also influences her pursuit of dynamic and thoroughly investigated narratives.
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