Banks, regulators test quantum-safe crypto transfers in cross-border pilot

A consortium of banks and regulators has launched a cross-border pilot to test post-quantum cryptography for digital asset transactions, with the underlying protocol code to be open-sourced for independent audit.

The Responsible Fintech Institute and Safeheron convened the initiative, which will evaluate a multi-party computation protocol supporting ML-DSA-65, the NIST FIPS 204 digital signature standard. Participants will test wallet generation and on-chain transfers on the quantum-resistant NEAR testnet. Regulators will take observer roles in the first phase, then contribute to a governance workstream in the next stage.

"No single bank, vendor, or regulator solves this alone," said Chia Hock Lai, Chairman of the Responsible Fintech Institute. "By bringing policymakers and financial institutions across jurisdictions together to test the same post-quantum architecture, and transparently sharing that research with every participant, we are building a compliance and security reference the whole industry can stand on – and a standard we all helped write."

Safeheron plans to open-source the protocol code. "Cryptography securing institutional assets should stand up to independent scrutiny, not ask for trust," said Jag Foo, the firm's Chief Security & Policy Officer.

Quantum computing is expected to break the public-key cryptography that secures much of the financial system. A 2025 Bank for International Settlements paper on quantum-readiness called for coordinated migration rather than a simple algorithm swap. Regulators are sharpening focus: in July, the Monetary Authority of Singapore and the Association of Banks in Singapore launched an AI-Driven Cyber and Technology Risk Taskforce. The Hong Kong Monetary Authority has embedded quantum readiness into its Fintech 2030 strategy, aiming for full sectoral quantum-ready status by 2030.

Current participants include the Abu Dhabi Global Market, the Gelephu Financial Services Office, and the Malta Financial Services Authority as regulators, plus Bison Bank and DK Bank. Additional institutions are in discussion to join.

"As the financial sector prepares for future cybersecurity challenges, initiatives that encourage collaboration and knowledge-sharing among industry participants are increasingly important," said António Henriques, CEO of Bison Bank.

The pilot uses a tentative non-custodial 2-of-2 MPC design that lets institutions retain control of key ownership without heavy operational burden. Results will feed into a whitepaper covering protocol design and testing, which the wider market can assess and build on.

"Preparing for the potential impact of quantum computing on the financial system requires early engagement, collaboration and a better understanding of how post-quantum technologies can operate in practice," said Alan Decelis, Head of Supervisory ICT Risk and Cybersecurity at the Malta Financial Services Authority. "Participating in this initiative provides a valuable opportunity to contribute a supervisory perspective while developing our understanding of the operational, governance and resilience considerations."

The Responsible Fintech Institute is an independent nonprofit that bridges traditional and decentralized finance through standards and governance. Safeheron provides digital asset custody infrastructure using MPC and trusted execution environments.