The Securities and Exchange Board of India (SEBI) has prepared an action plan to make the financial system “quantum-safe” ahead of its adoption, which is expected to pose security challenges, Chairman Tuhin Kanta Pandey said on Wednesday.
The upcoming quantum computing technology has the potential to crack the cryptography of passwords, which currently makes them secure, and so there is a need to prepare the market ecosystem in advance, Pandey said.
Action plan includes capacity building and market ecosystem preparation
“SEBI has prepared an action plan as well as capacity building initiatives on quantum readiness of its regulated ecosystem,” Pandey said at the annual Global Fintech Fest 2025.
The regulator has made quantum-safe computing a priority as the technology is expected to come in by 2028 or 2029. Therefore, the industry will need to reset its passwords and technology to adopt quantum-safe cryptography over the next few years.
Cybersecurity remains a top concern amid growing tech adoption
A significant amount of research is being conducted in quantum computing, which relies on principles of quantum mechanics to solve complex problems far beyond the capabilities of current computers. Fintechs are also testing the applications of blockchain technology in the securities market under SEBI’s Innovation Sandbox.
Even now, cybersecurity threats have the potential to create systemic disruptions. A single data breach or operational glitch can have cascading effects across interconnected systems, he said.
“As market participants increasingly rely on third-party service providers and cloud-based platforms, new vectors of risk emerge — sometimes beyond traditional regulatory perimeters,” Pandey said. “To counter these challenges, we have been taking various steps which include regulatory frameworks, continuous monitoring, capacitybuilding, standard operating procedure for classification and handling of cybersecurity Incidents.”
Dematerialisation and tech adoption essential for future markets
The regulator also does not see the ability to hold shares in paper form continuing for long, as the system has largely transitioned to dematerialisation. “As a regulator, I would say that we should adopt and embrace a technology both for our own good and for the good of the investor community we serve,” Pandey said.
“As we look to the future, we envision a securities market that is not only efficient and resilient, but also deeply inclusive, powered by innovation and technology for the betterment of all participants,” he said.
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Published on October 8, 2025
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