The cryptographic implications of QC are absurdly exaggerated.
QC has no practical impact on symmetric (AES, ChaCha) or hash (SHA2, SHA3, Blake) algorithms. Impact is isolated to number-theoretic asymmetric ciphers of certain types (DH, ECDH, ECDSA, EDDSA, etc.) and even there practical attacks would require very large, fast, low-noise quantum computers. The link I posted above is to a project to create the first NIST-certified asymmetric algorithms believed to not be vulnerable to quantum attack, rendering the whole thing pretty much moot.
Yeah, the hype has been extremely excessive. Putting some investment into quantum-resistant public key cryptography now is a reasonable hedge against the possibility of an surprise breakthrough in the next 10-30 years, but that should be about all we need to future-proof things. Unfortunately "quantum" is still a hot buzzword for managers and non-technical leadership, so it will be diverting resources and attention for the foreseeable future.
> The cryptographic implications of QC are absurdly exaggerated.
Every(?) current TLS session is vulnerable. _Many many_ auth sessions of other types are vulnerable. At least petabytes of stored sessions can be decoded (though not all).
It's hard to say how it's exaggerated at all. It's pretty much the device from Sneakers, but real.
That it won't break every possible thing for all time is true, but it's still about as huge as any practical thing can be.
> QC has no practical impact on symmetric or hash algorithms
It would require a doubling of key lengths to maintain security against quantum Grover search attacks.
> to create the first NIST-certified asymmetric algorithms believed to not be vulnerable to quantum attack
That will likely lead to much more than a doubling of key sizes; perhaps two orders of magnitude bigger. It will severely impact resource constrained cryptographic devices such as credit card chips.
> It would require a doubling of key lengths to maintain security against quantum Grover search attacks.
Grover could in theory reduce a 256-bit cipher like AES-256 or ChaCha to a 128-bit cipher. 128 bits is still far beyond what can be brute forced with any sane or practical amount of resources or time.
It would mean 128-bit keys would be unsafe, but 256-bit or higher has been recommended for years anyway for reasons beyond QC like birthday attacks.
Also keep in mind that this is a theoretical (as in big-O notation) speedup. Real world performance would depend a ton on the speed of the quantum computer. If a QC running Grover's algorithm isn't at least as fast as e.g. a conventional CPU then it might not be much faster in practice than a custom ASIC brute forcing a full strength key. That would make it pretty much an academic demo, not even useful in practice against 128-bit keys.
How reliably can they factor large numbers? Once false positive and complete failure rates are low enough, using one of them to do most of the legwork with traditional electronics to check the result and rerun as needed becomes a potentially useful combination.
I think even the factorization of 21 was somewhat cheating no? It seems like we’re really a long way off being able to use a QC for anything practical, if ever. And that’s not even talking about cracking crypto.
I agree that a proper demonstration should be of factoring any product of an m-bit prime by an n-bit prime. So if it only worked for 3*7 and not (with the exact same setup) for 3*5 then it shouldn't count.
It's sad that no-one has demonstrated a factorization of 4+4 bits (which should include factorizing 55,65,77,91, and 143). That would be an important milestone I think.
That's a possible demonstration, but bear in mind that they are also used for more analogue problems such as predicting chemical bond angles, where there is no discrete pass/fail, but rather a measure of how close they got to reality.
True; but those other useful applications of quantum computers are much messier to define and qualify, so factoring is still the ideal application for setting a milestone to be achieved.
1/ Definition of "real", "quantum" and "computer" may vary.
More seriously I don't think there's a real bar to what constitutes a "real" quantum computer, so it's in the eye of the beholder at this point I think.
As far as I know from publicly available info, there's nothing resembling a practically usable quantum computer yet (as in, a computer that would outperform a conventional one at some practical task).
There are real, usable, near-realtime Quantum Annealers, which are different from gate model quantum computers, but have proven to be much more amenable to physical implementation. These are more geared towards optimization functions, which can have practical use for logistics, physics simulations, and more.
Gate model computers interest everyone because of the potential to factor large numbers; this could potentially render a lot of existing and past cryptography open to decryption that otherwise will be locked up for aeons, especially considering the apparently decaying effect of Moore's Law of late. However, it probably takes millions or billions of gate qubits to do that, whereas thousands of annealing qubits are enough to solve some interesting problems, and to contribute to finding better solutions when combined with classical compute in a hybrid setup.
They were looking at IONQ+ which is what you get if you google IonQ. I guess those are the warrants. Google has the warrants as IONQ+ but Yahoo as IONQ-WT.
The people mentioning the lower price of $1/$1.38 appear to be referencing $IONQ-WT[1] but I can’t tell what the “WT” is for or whether it has any relation to $IONQ (which is indeed trading at ~$5.9).
As an RF/Microwave engineer, I think the elephant in the room are the control electronics. Presently these are racks of equipment for a few logical qubits.
Isn’t there a spareness limit to the qubit arrays to maintain entanglement? How are the read and write electronics going to be reasonably sized, or ever going to achieve the density needed for a million physical qubits?
Are there any problems for which that number of qubits is needed? The problems in physical chemistry that I have seen seem to require up to about 250 qubits, and cryptography seems somewhat more economical.
Any practical problem requiring only 250 qubits is in reference to error-corrected logical qubits. You need about 10,000 qubits to create one error-corrected logical qubit.
From what I can tell, and have seen in the past, scorpion capital make a business out of poorly researched, hearsay based, high-school level 'presentations' like this. Always published _after_ taking a huge short position.
They might not be wrong, but that would be a happy coincidence imo
I'm slightly fascinated by this document. It's so shoddy and the language used does indeed read like it's written by high school kids, or perhaps the mind behind the time cube. And yet it's 183 pages. Why go to such great lengths to produce a document that it's very hard to take seriously?
That would require a lot of effort and then it no longer would look like shit which may not help in the plausible deniability department, and to make it look like shit also has the same effect as the spelling errors and weird salutations in those scam emails: it filters for extreme gullibility. You are clearly not the intended audience.
They're trying to manage their legal risk here, that's why the document (after the first 25 or so pages) is almost entirely presented as quotations or specific references to research interviews they've conducted, rather than a narrative presentation. Without a solid factual matrix, making accusations of serious wrongdoing (e.g., fictious revenue via sham transactions with a related party) would put them at risk of defamation claims. That's also why they're throwing in the kitchen sink; there has to be enough damaging information in the document that's factually correct to make it fruitless for IONQ to pursue litigation against them.
Welcome to the world of consulting and finance. You know all those 1st/2nd/3rd year big firm employees that you hear grinding away for 16 hours on presentations and papers, being degraded by senior managers pushing them constantly?
This is what they produce - quantity over quality. This is what their managers think the client wants - they are paying by the hour afterall, got to give them a big pile or work.
Short sellers like these are usually small, single digit headcount operations. If anything, the dubious quality of the document reflects exactly that. And those big firm employees are usually very good at making good looking presentations and documents, though I agree that they are usually devoid of substance. So I'm not sure they are behind this shoddy looking document to be honest.
They outsource a lot of this stuff now - brokers, banks etc. The fund itself doesnt give a shit about pages >2 and just really care about the conclusion.
You can only have two of; fast, accurate and magnificent prose.
>Always published _after_ taking a huge short position.
as opposed to what? being a neutral observer? taking a short position after publishing the report? this is basically standard behavior from short-sellers.
Not to defend Scorpion Capital (because I don't know anything about them), but this is specifically why our public markets allow short selling... to provide an incentive to do this type of research (uncover alleged fraud, crimes, etc), stake a position, and then (optionally) advertise that position.
That’s not why we allow short selling. We allow short selling because it’s a reasonable way to allocate securities that makes people money sometimes while generally not hurting others. Our securities regulations are generally about allowing most transactions that aren’t done in an unfair way. It has nothing to do with creating incentive to investigate publicly traded companies. Investigations with huge payouts depending on their results aren’t unbiased and should never be taken as factual or helpful.
The party loaning the security to the short seller makes a profit too as part of the loan. The only person potentially going to lose money is the short seller. The person loaning the security might end up getting the security back once it’s fallen a lot, or it might have risen, but they don’t really take any outrageous risk. Just the person who borrowed and sold takes the potential losses.
What is dubious about this mechanism? It seems fairly straight forward and short selling doesn’t even depress the price any more than someone simply selling it to the market. In fact since they have to buy it back later they first create sell pressure down then buy pressure up later.
All securities trading is a zero sum game. For every “winner” there are “losers.” By hurt I mean, essentially, some form of fraud or similar activity that puts others at risk without their understanding the risks, or where the outcome is always a loss for the counterparties.
For sure, it's badly written, and lazily formatted. It does extrapolate quite a bit from the data it gathers, and has no undisputable evidence. But then, it's way too much to expect some small private group to do elaborate reports and gather evidence suitable for a criminal court.
If you catch them being wrong, that would be enough of an issue to discredit them. But none of the above is.
No opinion on the quality of Scorpion Capital's research but of course they would short before they publish their negative research. Why wouldn't they?
Agree, I find their argumentation quite convincing and it's easy to check, too.
Yes, the IonQ prospectus does have a lot of hockey-stick graphs and lots of roadmaps that look ambitions. And yes, they do distance themselves from all of those graphs in the footnotes. I do find that suspicious and somewhat misleading, too.
And an employee saying "I guess [the old fired CEO] wasn’t hype enough. And then this [new CEO] came in and just set up a SPAC, just to go public." seems pretty damning, too.
If you believe they are taking positions in their research, and you believe they're as accurate as a stuck clock, how is it you explain that they're still in business?
I see comments like this in any discussion involving short sellers, and I've not been given any reason to believe it is more than sour grapes. But my mind is open to it.
You could build a short position, publish fake research, and then quickly cover your short on the initial move before anyone had time to rebut you. That is definitely illegal fraud, though, and both the target and the SEC would try to find you.
You can say the same thing for the long side, but no one seems to mind when people go on TV and blow a bunch of smoke about their favorite companies.
Yes this is theoretically possible but no it is not likely someone can make a career out of it. Short research isn't a magic wand that makes the price go down. Good faith short sellers have their positions blow up in their face all the time, sometimes just because people don't like them and wouldn't mind seeing them get their comeuppance. A short seller publishing in bad faith would be fighting an uphill battle while surrounded by easier grifts.
Surely there must be some frauds among the short sellers some of them time, but there's a common view that it's all of them all of the time. From my perspective this appears to be a conspiracy theory among bulls who think that publishing negative information about any company is a threat to their portfolio, and reason backwards from there.
Only being half serious of course ('taking the piss' being an accurate euphemism here), but if you think Scorpion Capital are wrong, you can always take the opposite position. You could even publish a better document rebutting their claims and calling them out.
The question is: how much money you're willing to bet that they're wrong?
This argument assumes the market is rational and well informed. It would be totally possible to have a market where a well-resourced player could tank arbitrary stocks, and smaller players would lose by betting against them. Making no claims about the situation here in particular, just that “put your money where your mouth is” isn’t convincing.
The stock market will never be bigger than the product/service market
Sales and profit are real and 100% liquid unlike the marketcap which is essentially a perpetual voting machine.
If the product is legit and starts selling , then it's gonna be shortsellers to lose out and and people betting on the company would win as long as they don't screw themselves using leverage.
But on paper it is, sure the value will plunge the moment a significant liquidation event happens but as far as things go on paper, the market valuation of companies (and especially tech companies) are magnitudes bigger than their net income.
Net income and free cash flow are real, once achieved only long lawsuits and the government can take that away from the corporation.
Marketcap can be deflated instantly just if enough people click the sell button.
If you want to compare them you have to discount the marketcap adjusting it for the instability and undecisiveness of the human brain and also the instability of the marketplace of ideas and political currents, the instability of hero worship around the CEO and millions of other things. Once it's said and done it's a pretty big discount you have to apply.
This article seems full of easily falsifiable claims, chief among these being the claims made about the fraudulent credentials of the CEO. If that claim is false the CEO could easily puncture the whole thing by showing proof otherwise.
Not only that, but if this is false it seems extremely actionable. Couldn't the characters here sue the pants off the authors if these claims are false? Not to mention the exposure to SEC action for taking a short position and then slandering the company. I know this does happen and is rarely prosecuted but combined with the civil liability that seems like a lot of exposure for Scorpion Capital.
It won't confuse any reader on HackerNews who understand S3 buckets URL capabilities, but how many less web-savvy investors will be confused by the domain hosting this report, and think the report is published or endorsed by Amazon Web Services?
The cynic in me thinks that this was intentional to provide an additional air of credibility (subconscious or otherwise) to the presentation, which is otherwise extremely unprofessional in structure, framing, font selection, emphasis, tone, etc. It reminds me more of TimeCube [0] then professional investigative research/analysis.
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[ 3.5 ms ] story [ 32.4 ms ] threadhttps://en.wikipedia.org/wiki/Integer_factorization_records#...
Machines that can would quickly become important to national security though.
The cryptographic implications of QC are absurdly exaggerated.
QC has no practical impact on symmetric (AES, ChaCha) or hash (SHA2, SHA3, Blake) algorithms. Impact is isolated to number-theoretic asymmetric ciphers of certain types (DH, ECDH, ECDSA, EDDSA, etc.) and even there practical attacks would require very large, fast, low-noise quantum computers. The link I posted above is to a project to create the first NIST-certified asymmetric algorithms believed to not be vulnerable to quantum attack, rendering the whole thing pretty much moot.
Every(?) current TLS session is vulnerable. _Many many_ auth sessions of other types are vulnerable. At least petabytes of stored sessions can be decoded (though not all).
It's hard to say how it's exaggerated at all. It's pretty much the device from Sneakers, but real.
That it won't break every possible thing for all time is true, but it's still about as huge as any practical thing can be.
It would require a doubling of key lengths to maintain security against quantum Grover search attacks.
> to create the first NIST-certified asymmetric algorithms believed to not be vulnerable to quantum attack
That will likely lead to much more than a doubling of key sizes; perhaps two orders of magnitude bigger. It will severely impact resource constrained cryptographic devices such as credit card chips.
Grover could in theory reduce a 256-bit cipher like AES-256 or ChaCha to a 128-bit cipher. 128 bits is still far beyond what can be brute forced with any sane or practical amount of resources or time.
It would mean 128-bit keys would be unsafe, but 256-bit or higher has been recommended for years anyway for reasons beyond QC like birthday attacks.
Also keep in mind that this is a theoretical (as in big-O notation) speedup. Real world performance would depend a ton on the speed of the quantum computer. If a QC running Grover's algorithm isn't at least as fast as e.g. a conventional CPU then it might not be much faster in practice than a custom ASIC brute forcing a full strength key. That would make it pretty much an academic demo, not even useful in practice against 128-bit keys.
It's sad that no-one has demonstrated a factorization of 4+4 bits (which should include factorizing 55,65,77,91, and 143). That would be an important milestone I think.
1/ Definition of "real", "quantum" and "computer" may vary.
More seriously I don't think there's a real bar to what constitutes a "real" quantum computer, so it's in the eye of the beholder at this point I think.
As far as I know from publicly available info, there's nothing resembling a practically usable quantum computer yet (as in, a computer that would outperform a conventional one at some practical task).
Gate model computers interest everyone because of the potential to factor large numbers; this could potentially render a lot of existing and past cryptography open to decryption that otherwise will be locked up for aeons, especially considering the apparently decaying effect of Moore's Law of late. However, it probably takes millions or billions of gate qubits to do that, whereas thousands of annealing qubits are enough to solve some interesting problems, and to contribute to finding better solutions when combined with classical compute in a hybrid setup.
- https://finance.yahoo.com/quote/IONQ?p=IONQ&.tsrc=fin-srch
- https://www.google.com/finance/quote/IONQ:NYSE
- https://www.google.com/finance/quote/IONQ+:NYSE
- https://finance.yahoo.com/quote/IONQ-WT
[1] https://finance.yahoo.com/quote/IONQ-WT/
Isn’t there a spareness limit to the qubit arrays to maintain entanglement? How are the read and write electronics going to be reasonably sized, or ever going to achieve the density needed for a million physical qubits?
They might not be wrong, but that would be a happy coincidence imo
This is what they produce - quantity over quality. This is what their managers think the client wants - they are paying by the hour afterall, got to give them a big pile or work.
You can only have two of; fast, accurate and magnificent prose.
as opposed to what? being a neutral observer? taking a short position after publishing the report? this is basically standard behavior from short-sellers.
Also, seems like they've had some decent wins in the past: https://scorpioncapital.com/track-record
What is dubious about this mechanism? It seems fairly straight forward and short selling doesn’t even depress the price any more than someone simply selling it to the market. In fact since they have to buy it back later they first create sell pressure down then buy pressure up later.
For sure, it's badly written, and lazily formatted. It does extrapolate quite a bit from the data it gathers, and has no undisputable evidence. But then, it's way too much to expect some small private group to do elaborate reports and gather evidence suitable for a criminal court.
If you catch them being wrong, that would be enough of an issue to discredit them. But none of the above is.
It's a lot more due diligence than most investors. (e.g. consider r/wallstreetbets)
Yes, the IonQ prospectus does have a lot of hockey-stick graphs and lots of roadmaps that look ambitions. And yes, they do distance themselves from all of those graphs in the footnotes. I do find that suspicious and somewhat misleading, too.
And an employee saying "I guess [the old fired CEO] wasn’t hype enough. And then this [new CEO] came in and just set up a SPAC, just to go public." seems pretty damning, too.
I see comments like this in any discussion involving short sellers, and I've not been given any reason to believe it is more than sour grapes. But my mind is open to it.
Yes this is theoretically possible but no it is not likely someone can make a career out of it. Short research isn't a magic wand that makes the price go down. Good faith short sellers have their positions blow up in their face all the time, sometimes just because people don't like them and wouldn't mind seeing them get their comeuppance. A short seller publishing in bad faith would be fighting an uphill battle while surrounded by easier grifts.
Surely there must be some frauds among the short sellers some of them time, but there's a common view that it's all of them all of the time. From my perspective this appears to be a conspiracy theory among bulls who think that publishing negative information about any company is a threat to their portfolio, and reason backwards from there.
The question is: how much money you're willing to bet that they're wrong?
Sales and profit are real and 100% liquid unlike the marketcap which is essentially a perpetual voting machine.
If the product is legit and starts selling , then it's gonna be shortsellers to lose out and and people betting on the company would win as long as they don't screw themselves using leverage.
Marketcap can be deflated instantly just if enough people click the sell button.
If you want to compare them you have to discount the marketcap adjusting it for the instability and undecisiveness of the human brain and also the instability of the marketplace of ideas and political currents, the instability of hero worship around the CEO and millions of other things. Once it's said and done it's a pretty big discount you have to apply.
Not only that, but if this is false it seems extremely actionable. Couldn't the characters here sue the pants off the authors if these claims are false? Not to mention the exposure to SEC action for taking a short position and then slandering the company. I know this does happen and is rarely prosecuted but combined with the civil liability that seems like a lot of exposure for Scorpion Capital.
They compare the public messaging from executives and the company website with what is publicly disclosed in the company perspective.
The report could have been 4 pages long.
The cynic in me thinks that this was intentional to provide an additional air of credibility (subconscious or otherwise) to the presentation, which is otherwise extremely unprofessional in structure, framing, font selection, emphasis, tone, etc. It reminds me more of TimeCube [0] then professional investigative research/analysis.
[0] https://timecube.2enp.com/