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What is a Quantum Random Number Generator (QRNG)?

Originally published Febuary 16, 2017.

If you take a programming class that actually makes you sling some code, you’ve probably come across the need to generate random numbers for some purpose. Sure, you can use the RAND software function and that will probably work just fine. While software can be used to generate random numbers, incredibly it can never do so without demonstrating a pattern. There is a very cool statistical test suite called the “Diehard Tests”  which you can use to determine if a number is truly random. You can see output below from a software generated random number and a quantum random number generator (QRNG):

Which of the above images is not truly random? It’s the one on the left. You can tell because of the vertical lines that are observed. The one on the right has no geometric patterns and is in fact produced by a Quantum Random Number Generator or QRNG.

What is a Quantum Random Number Generator (QRNG)?

We talked about generating random numbers using software that are not truly random. You can also use electronics hardware to produce random numbers by using physical properties like electrical noise or the decay of radioactive material. This isn’t actually a big deal to do and it’s called a Hardware Random Number Generator (HRNG). Below is an example of an HRNG:

HRNGs can also come in the form of condensed chip-sets. Intel’s Ivy Bridge processors as an example offer this though incredibly, some developers have said they won’t use them citing the Edward Snowden leaks as evidence that some sort of “back door” exists. While chips like Intel’s use electrical properties to produce randomness, another type of hardware random number generator is the quantum random number generator.

Before we get into the nitty gritty, you may want to first read our primer on quantum everything. Then, we recommend you read this excellent article by Nature which gives you every single detail of the technical aspects with awesome diagrams like this one that explain the technology in simple layman’s terms:

What’s that you say? You don’t want to be bored to tears have the time to read all that? In that case, the only thing you really need to know about a QRNG is that it can generate a truly random number. Why is that so important? Because all encryption protocols require a source of truly random numbers. The security of the entire cyber world relies on truly random numbers generated by various types of hardware devices with QRNGs being the creme-de-la-creme of the lot. Interested in picking one of these bad boys up? Read on.

Which Companies Sell Quantum Random Number Generators (QRNGs)?

There aren’t that many companies building QRNG devices. In our previous article on “5 Quantum Cryptography and Quantum Encryption Companies“, we identified a Swiss startup called ID Quantique (IDQ) which was the first company to develop a quantum random number generator (QRNG) in 2001. With $5.6 million in total funding so far, IDQ claims to be the world leader in this space and offers a variety of formats for their QRNG like the ones seen below:

The above hardware is protected by patent US 7519641.

Another startup that we covered in the same article is called QuintessenceLabs which has taken in an undisclosed amount of funding over the past ten years. Their QRNG device seen below claims to be so powerful that it is the equivalent of 60 IDQ devices:

Just last month, Australian banking giant Westpac Group upped their investment in QuintessenceLabs from 11% to 16% after making an initial investment in 2015. Clearly some milestones were hit for this to happen.

Another firm developing QRNG devices since 1994 is ComScire, a Florida firm that has now sold four generation of hardware models with increasing capabilities and only one confirmed hardware failure in 20 years. Here’s one of their devices, the world’s fastest USB-connected true random number generator:

Note that the above technology is protected by a suite of 5 patents.

Lastly, a newcomer on the block is actually a publicly traded mining company shell called Quantum Numbers Corp (CVE:QNC) which is licensing technology developed by Bertrand Reulet,a world leader in researching quantum and non-Gaussian noise. Here’s a look at the working prototype they are planning to commercialize which may have the lowest profile of any device yet:

QNC recently launched the device seen above, closed around $1 million in funding, brought on a new CEO, and laid out a plan to achieve their first licensing agreement by May of 2017.

How Much Does a Quantum Random Number Generator (QRNG) Cost?

Since QNC is a publicly traded company, their filings contain a wealth of information about the QRNG space. In their latest filing, the below table is provided which shows a price comparison between a number of QRNG product offerings:

Source: Quantum Numbers Corp

Note that the last row above has the manufacturer listed as “Resulting Issuer” which is in fact QNC. Their product claims to offer a superior cost advantage though it presently only exists in functional prototype form. The others above are actually being sold today.

Based on the above table, we can conclude that these devices aren’t cheap. We can also conclude that there’s a lot of money to be had here given that the QRNG market is expected to approach $1 billion by 2020. Is there any way we can make some money off of this as retail investors? Let’s take a look.

Can I Invest in Quantum Number Generator Stocks?

This is the sort of query we’re expecting this article to rank high for in Google search. That’s because the first time people see some sensational 60-minute special on the amazing potential of quantum computing, this is the sort of search that some viewers will inevitably plug into Google.

The only publicly traded stock right now is Quantum Numbers Corp (QNC) and there are several things to be aware of here.

  1. They have filed patents for their technology only recently and nothing has been granted yet – Taken verbatim from the filing “The Invention is registered under an international patent application No. PCT/CA2015/050408 valid until November 9, 2016“. They then filed patents in multiple countries and that is where it sits today.

  2. Nothing says that this device will sell – We’ve seen far too many companies like this that have incredible sounding technology from a university and then it never gets commercialized. We see it all the time. No matter how convinced you are that this is the Holy Grail, it may never be commercialized. Just ask a Scuderi investor.

  3. They only have $1 million which is not much capital at all – The timeline and projected costs can be seen below:

So the next milestone for investors is in about 3 months when the first licensing agreement is expected to be signed. Outside of QNC, retail investors can only hope that there is an exist event for any of these other private companies in the form of an IPO.

Published: February 16, 2017

For full article, click here.

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