Trump Administration in Talks to Fund Quantum Computing Development

The three companies actively in discussions are IonQ, Rigetti Computing and D-Wave Quantum, per the Journal, while Quantum Computing and Atom Computing are weighing entering talks.

Quantum computing is seen as a critical future technology due to its ability to perform calculations that could take years to perform using conventional computers. It promises to help discover new drugs, chemicals and other materials with significant economic benefits, as well as finding uses in finance, aerospace and other sectors.

Legacy computer companies, including IBM and Microsoft, are also investing heavily in quantum technology research, as are geopolitical and economic rivals such as China.

Research on quantum computing recently has made significant advances although it remains unclear when the technology will be ready for commercial deploying. Quantum computing technology harnesses the principles of quantum mechanics, such as superposition, quantum entanglement and quantum interference to process information. Unlike traditional computers, which rely on binary bits (0 or 1) to perform calculations, quantum computers use qubits, which can represent multiple states simultaneously. That enables them to perform far more complex calculations, offering solutions to problems once considered computationally impossible.

Per the Journal, the discussions are being led by Deputy Secretary of Commerce Paul Dabber, a former co-founder of Bohr Quantum Technology, a quantum computing company.

Related: Quantum Computing: Overview of Drafting Considerations for Quantum-as-a-Service Agreements

The funding would come from CHIPs Act, passed during the Biden administration as part of an effort to accelerate the development and production of cutting-edge technologies, such as advance computer chips needed for artificial technology. The Trump administration has sought to roll back many provisions in the law and recently clawed back billions of dollars that were earmarked for technology research.

The White House had teased the possibility of announcements on quantum computing in September, and had put out the word to industry that the administration was open for discussions.

According to the Journal, the funds would be provided in exchange for the Commerce Department gaining equity stakes in the companies. If the talks were to pan out, it would be the latest example of the Trump administration taking a financial stake in companies in exchange for government support.

In August the government took a 10% stake in Intel in exchange for converting $9 billion in previously award grants into equity. It has also taken stakes in three rare-earth companies ranging from 10% to 15%, and was granted a “golden share” in U.S. Steel in exchange for the administration approving its acquisition by Nippon Steel of Japan.

The investments have given rise to controversy over their legality and constitutional foundation. There are currently no laws governing how such investments are to be overseen or how any proceeds are to be allocated. Under the Constitution, Congress controls the allocation of public funds, but it’s unclear whether funds derived from investments in private companies fall under that rubric. The administration has not publicly disclosed how those equity stakes are being managed or how any appreciation in the value of those stakes is being accounted for.