{"id":8567,"date":"2025-01-09T15:58:45","date_gmt":"2025-01-09T21:58:45","guid":{"rendered":"https:\/\/scottaaronson.blog\/?p=8567"},"modified":"2025-01-14T03:36:25","modified_gmt":"2025-01-14T09:36:25","slug":"above-my-pay-grade-jensen-huang-and-the-quantum-computing-stock-market-crash","status":"publish","type":"post","link":"https:\/\/scottaaronson.blog\/?p=8567","title":{"rendered":"Above my pay grade: Jensen Huang and the quantum computing stock market crash"},"content":{"rendered":"\n

Update (Jan. 13):<\/mark><\/strong> Readers might enjoy the Bankless Podcast<\/a>, in which I and Justin Drake of the Ethereum engineering team discuss quantum computing and its impact on cryptocurrency. I learned something interesting from Justin—namely that Satoshi has about $90 billion worth of bitcoin that’s never been touched since the cryptocurrency’s earliest days, much of which (added:<\/strong> the early stuff, the stuff not additionally protected by a hash function) would be stealable by anyone who could break elliptic curve cryptography—for example, by using a scalable quantum computer. At what point in time, if any, would this stash acquire the moral or even legal status of (say) gold doubloons just lying on the bottom of the ocean? Arrr, ’tis avast Hilbert space!<\/p>\n\n\n\n

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Apparently Jensen Huang, the CEO of NVIDIA, opined on an analyst call<\/a> this week that quantum computing was plausibly still twenty years away from being practical. As a direct result, a bunch of publicly-traded quantum computing companies (including IonQ, Rigetti, and D-Wave) fell 40% or more in value, and even Google\/Alphabet stock fell on the news.<\/p>\n\n\n\n

So then friends and family attuned to the financial markets started sending me messages asking for my reaction, as the world’s semi-unwilling Quantum Computing Opiner-in-Chief.<\/p>\n\n\n\n

My reaction? Mostly just that it felt really<\/em> weird for all those billions of dollars to change hands, or evaporate, based on what a microchip CEO offhandedly opined about my tiny little field, while I (like much of that field) could\u2019ve remained entirely oblivious to it, were it not for all of their messages!<\/p>\n\n\n\n

But was Jensen Huang right<\/em> in his time estimate? And, relatedly, what is<\/em> the “correct” valuation of quantum computing companies? Alas, however much more I know about quantum computing than Jensen Huang does, the knowledge does not enable me to answer to either question.<\/p>\n\n\n\n

I can<\/em>, of course, pontificate about the questions, as I can pontificate about anything.<\/p>\n\n\n\n

To start with the question of timelines: yes, there’s a lot still to be done, and twenty years might well be correct. But as I’ve pointed out before, within the past year we’ve seen 2-qubit gates with ~99.9% fidelity, which is very near the threshold for practical fault-tolerance. And of course, Google has now demonstrated fault-tolerance that becomes more and more of a win with increasing code size. So no, I can’t confidently rule out commercially useful quantum simulations within the next decade. Like, it sounds fanciful, but then I remember<\/strong> how fanciful it would’ve seemed in 2012 that we’d have conversational AI by 2022. I was alive in 2012! And speaking of which, if you really believe (as many people now do) AI will match or exceed human capabilities in most fields in the next decade, then that will scramble all the other timelines too. And presumably Jensen Huang understands these points as well as anyone.<\/p>\n\n\n\n

Now for the valuation question. On the one hand, Shtetl-Optimized<\/em> readers will know that there\u2019s been plenty of obfuscation and even outright lying, to journalists, the public, and investors, about what quantum computing will be good for and how soon. To whatever extent the previous valuations were based on that lying, a brutal correction was of course in order, regardless of what triggered it.<\/p>\n\n\n\n

On the other hand, I can\u2019t say with certainty that high valuations are wrong! After all, even if there\u2019s only a 10% chance that something will produce $100B in value, that would still justify a $10B valuation. It\u2019s a completely different way of thinking than what we\u2019re used to in academia.<\/p>\n\n\n\n

For whatever it’s worth, my own family\u2019s money is just sitting in index funds and CDs. I have no quantum computing investments of any kind. I do<\/em> sometimes accept consulting fees to talk to quantum computing startups and report back my thoughts. When I do, my highest recommendation is: “these people are smart and honest, everything they say about quantum algorithms is correct insofar as I can judge, and I hope<\/em> they succeed. I wouldn’t invest my own money, but I’m very happy if you or anyone else does.” Meanwhile, my lowest<\/em> recommendation is: “these people are hypesters and charlatans, and I hope they fail. But even then, I can’t say with confidence that their valuation won’t temporarily skyrocket, in which case investing in them would presumably have been the right call.”<\/p>\n\n\n\n

So basically: it’s good that I became an academic rather than an investor.<\/p>\n\n\n\n

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Having returned from family vacation, I hope to get back to a more regular blogging schedule … let’s see how it goes!<\/p>\n","protected":false},"excerpt":{"rendered":"

Update (Jan. 13): Readers might enjoy the Bankless Podcast, in which I and Justin Drake of the Ethereum engineering team discuss quantum computing and its impact on cryptocurrency. I learned something interesting from Justin—namely that Satoshi has about $90 billion worth of bitcoin that’s never been touched since the cryptocurrency’s earliest days, much of which […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"{title}\n\n{excerpt}\n\n{url}","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false,"jetpack_post_was_ever_published":false},"categories":[4,17],"tags":[],"class_list":["post-8567","post","type-post","status-publish","format-standard","hentry","category-quantum","category-speaking-truth-to-parallelism"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=\/wp\/v2\/posts\/8567","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8567"}],"version-history":[{"count":5,"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=\/wp\/v2\/posts\/8567\/revisions"}],"predecessor-version":[{"id":8578,"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=\/wp\/v2\/posts\/8567\/revisions\/8578"}],"wp:attachment":[{"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8567"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8567"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scottaaronson.blog\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8567"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}