Eric Jackson, the founder, president, and portfolio manager at EMJ Capital, expressed his enthusiasm for quantum computing stocks during a recent discussion on CNBC, highlighting this sector as his top pick for 2025. He noted that the market for publicly listed quantum computing companies is relatively small, but these stocks have seen significant gains, particularly following the U.S. election.
Jackson explained that the initial surge in quantum stock prices was partly due to news from China in October about the development of a quantum computer capable of breaching RSA security protocols, which are currently considered state-of-the-art. This development sparked interest in quantum computing as a potential new frontier in technology, often termed as a “Trump trade” due to the perceived boost from policy changes favoring tech innovation.
The excitement was further fueled by Google’s announcement of the Willow chip in early December. This announcement shifted public perception from quantum computing being a decade away to possibly just a couple of years from practical application, suggesting that quantum computing could soon challenge established tech giants like Nvidia (NVDA). “Quantum stocks are in fact, like, sort of a next generation version of AI and a potential threat even to the Nvidia’s of the world,” Jackson said. This has led investors to seek out quantum computing stocks, viewing them as the next evolution of AI technology.
Among his investments, Jackson mentioned Rigetti Computing (RGTI), which he bought in early December for just over $3 per share. The stock has since skyrocketed to around $20, yet it remains a relatively small-cap stock with a market cap under $5 billion (last checked, $4.73 billion). He also pointed to other players like IonQ Inc. (IONQ) and D-Wave Quantum Inc. (QBTS), which are developing quantum computing systems.
Jackson also discussed the implications for cybersecurity, noting that quantum computing could pose a severe threat to current encryption standards like SHA-256, used in cryptocurrency wallets, and RSA. This scenario has led him to invest in companies like BTQ Technologies (OTC:BTQQF), a small-cap company with a market cap around $5.5 million, which is working on security solutions for the quantum era. He likened investing in such companies to venture capital investments due to their potential for high growth in a niche but rapidly evolving field.
Overall, Jackson’s optimism is based on the transformative potential of quantum computing, its implications for security, and the current undervaluation of the few publicly traded companies in this space. He sees this sector not just as an investment opportunity but as the next big technological leap following the AI boom.
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