01 Quantum: Quantum Optionality
How Investors Should Position Themselves if the Market Starts Valuing Execution
Report #1 & #2 Recap
Sophic Capital’s The Quantum-AI Convergence Report highlighted that the market increasingly needs practical migration and privacy solutions, not just quantum theory as quantum computing, and AI platforms evolve, and these technologies become capable. Post-quantum cybersecurity is becoming a real infrastructure, compliance, and AI-integrity issue, and: the key question for investors is, which companies can translate that market need unlocked by these new technologies into deployable products, customer adoption, revenue, and cash flow.
The compliance timeline is becoming increasingly clear. Under the NSA’s CNSA 2.0 framework, all new national security systems are expected to use quantum-resistant algorithms starting in January 2027, with custom and legacy applications targeted for migration by 2030 and full quantum-resilient cryptographic infrastructure required across national security systems by 2035.
In other words, the standards are now in place, and the deadlines are rapidly coming into focus, from a solution deployment point of view. The remaining challenge now is less about awareness, and more about execution. Enterprises need the tools to inventory, assess, and migrate thousands of cryptographic and data privacy dependencies across software, hardware, certificates, keys, protocols, and AI models in an organized, structured way that can be managed without disrupting core day-to-day operations.
Our second report, 01 Quantum: Productizing Post-Quantum Security, examined 01 Quantum’s positioning within that market, highlighting its implementation-driven model, partner-led deployments, and wrapper-based strategy across remote access, digital assets, and secure AI.
At the core of 01 Quantum’s platform is IronCAP™, the Company’s standards-based post-quantum cryptography (“PQC”) foundation. Rather than trying to monetize cryptography as a stand-alone engine directly and competing with technology giants, 01 Quantum uses IronCAP as a security layer that can be integrated into existing real-world products and workflows with minimal disruptions to their existing operations. This wrapper-based approach runs across the Company’s key product categories: remote access, digital assets, communications, and AI. That matters because customers typically do not want another encryption tool or algorithm in isolation; they want an existing application, or platform made quantum-safe and commercially usable and/or high level of security when training and using increasingly complex AI models. In practical terms, 01 Quantum is trying to identify cryptographically exposed workflows, layer in post-quantum protection, and commercialize the upgraded product through customers and partners.
This report asks the obvious next question: is the market giving 01 Quantum enough credit for its current positioning in post-quantum cybersecurity and privacy-preserving AI?
The Investment Debate: Category Recognition vs. Company Recognition
The post-quantum theme is receiving increasing investor attention, but market recognition within the category has been uneven. In many cases, public-market enthusiasm has attached first to the broad “quantum” theme and only later to the underlying differences in commercialization, customer traction, and business model quality. As is common with new and emerging technology platforms, relevant investor interest can be volatile, headline-driven, and move rapidly amongst the entire group of relevant stocks or selectively amongst stocks.
That dynamic may be relevant here. 01 Quantum appears to be one of the few publicly traded Canadian names in the category with live partner deployments and initial reported commercial revenue. Yet it continues to trade at a substantial lower valuation and discount to better-known Canadian peers.
While it is impossible to predict when, or if, the market will eventually close that valuation gap, as 2026 mandates take effect, the transition to a PQC-first valuation model represents a re-rating opportunity for the stock. While peers in the quantum space often trade on speculative hardware timelines and/or news headlines pertaining to quantum research breakthroughs, 01 Quantum has the potential to trade on realized software utility, which could reduce volatility and provide a simplified model for investors to value.
That disconnect is where the opportunity may be.
Peer Valuation Context
The valuation gap between 01 Quantum and certain Canadian peers is . Traditionally investors have valued software companies at a premium due to their high gross margins, and low capital expenditure requirements. However, within the public quantum computing landscape, a disconnect has emerged. 01 Quantum trades at a market capitalization of approximately CA$54 million, while certain peers have achieved exponentially higher valuations, despite less operational validation or even lower current revenue velocities.
For example, Quantum eMotion (QNC: TSXV) (QNC: NYSE) trades at a market capitalization of nearly CA$1 billion and BTQ Technologies (CBOE: BTQ) (BTQ: NSDQ) trades at a market capitalization of approximately CA$736 million, both an order of magnitude higher than 01 Quantum’s level, despite 01 Quantum already reporting early commercial validation progress and having live partner-led product deployments.
That does not mean 01 Quantum should automatically trade at a similar market capitalization. Each company has its own technology stack, financing history, investor base, expectations, and narrative. Some peers also benefit from stronger liquidity, broader awareness, media awareness, or more promotional market positioning. But that said, when a Company with live deployments and reported revenue trades at a small fraction of sector peers, investors should investigate and at least ask whether the discount has become too wide, which could present an opportunity.
A Structural Divergence: Why the Discount Exists Today
To understand why the market is currently discounting 01 Quantum, institutional and retail investors must look past the “quantum” label and analyze the specific sub-sectors these companies occupy:
|
Quantum Security Landscape |
||
| 01 Quantum (ONE) | Quantum eMotion (QNC) | BTQ Technologies (BTQ) |
|
· Quantum Safe Comms, Crypto, AI · Software based PQC · Live Initial Deployments |
· Hardware QRNG Chips · Semiconductor Fab · Pre-Scale Commercialization |
· Academic PQC / IP · Ledger / Chain Research · Pre-Revenue Scale |
Frictionless Scaling: Software vs. Hardware
Quantum eMotion (QNC) has traded at a market capitalization of nearly $1 billion, nearly 19 times that of 01 Quantum.
To fully grasp why QNC trades at a market capitalization of around CA$1 billion (despite reporting F2025 revenue of $11,171), investors have looked at the specific market sub-segment QNC occupies, its structural positioning, set expectations for future execution and assigned a premium to the stock, in part based on the value the market places on hardware-rooted security, today.
QNC represents a “Hardware Root of Trust” play, Specifically Quantum Random Number Generators (QRNG) built on semiconductor chips. This requires a classic hardware business model. To scale, QNC must navigate the physical realities of the global semiconductor supply chain, and all its emerging challenge. This means building foundry partnerships, waiting on chip manufacturing timelines, dealing with physical distribution logistics, and convincing device manufacturers to change their physical chip layouts. It is a slow, capital-intensive process. Its valuation is not driven by typical enterprise trailing software multiples, but rather by the strategic positioning of its physical intellectual property (IP) and its inclusion in major critical infrastructure consortia.
The most critical advantage 01 Quantum holds over QNC is its deployment architecture. 01 Quantum operates a pure PQC software platform (IronCAP). 01 Quantum does not require a semiconductor foundry; its solutions deploy via APIs into existing enterprise architectures. While QNC has successfully captured investor attention via the highly valued semiconductor narrative. An enterprise can deploy 01 Quantum’s software across an entire global cloud infrastructure in an afternoon. This gives 01 Quantum an infinitely higher velocity of scale and the near-100% gross margins typical of elite SaaS enterprises, completely free from supply chain bottlenecks.
QNC’s valuation proves that the public markets have an appetite for quantum security exposure and are willing to pay massive premiums for companies that align with the defense, AI, and chip-manufacturing trends. 01 Quantum offers investors an entry point into the exact same quantum macro-trend but through an agile, high-margin, capital light software platform that is already generating initial commercial revenues, proving the business model works.
Realized Commercialization vs. Academic Speculation
BTQ Technologies (BTQ) commands a market capitalization of roughly $736 million, roughly 14 times the valuation of 01 Quantum.
To understand why BTQ Technologies commands a premium market capitalization, investors must evaluate how global capital markets price pre-revenue technology platforms. BTQ does not trade on traditional fundamentals multiples or multiples like Price-to-Earnings (P/E) or Price-to-Sales (P/S). Instead, its valuation is driven by a highly specialized Intellectual Property (IP) Accumulation strategy, an accomplished academic pedigree, and its direct exposure to the rapidly expanding Web3, blockchain, and digital asset infrastructure sectors.
BTQ is heavily anchored in academic research, long-term intellectual property (IP) development, and post-quantum solutions for blockchain ledgers. However, looking at their financials, BTQ reported F2025 revenues of $315,497 against a large net loss due to heavy research and development expenses.
BTQ Technologies has successfully demonstrated that the market is willing to assign more than a half-billion-dollar valuation to quantum-safe cryptography based purely on intellectual property and long-term blockchain research, which suggests high future expectations for revenue and cash flow. That said, BTQ contends with a high annual cash burn.
01 Quantum has already crossed the chasm into commercial deployment, proving the existence of market demand for its solutions. For the first quarter of 2026, 01 Quantum reported $349,770 in revenue alone, a threefold increase from a year ago. For context, 01 Qunatum reported $760,000 in revenue and a net loss of $1.1 million for fiscal 2025. Furthermore, 01 Quantum operates with a leaner capital profile, burning a fraction of the cash that research-heavy peers do. While some peers are still valued primarily on future commercialization potential, 01 Quantum’s commercial revenue engine is live, integrated into major multinational pipelines (such as Hitachi Solutions Create, Ltd.), and actively growing.
If 01 Quantum continues to convert technical milestones into customer wins, paid deployments, and recurring economics, even partial multiple convergence could matter. In that sense, the valuation conversation is less about arguing for immediate parity and more about highlighting how little commercial success may currently be priced into the stock.
Put differently: 01 Quantum may not need perfect execution to re-rate. It may only need continued proof that commercialization is real and repeatable and can successfully scale the Company without relying on hard to predict technology breakthroughs.
While the public markets feature a growing ecosystem of quantum computing, hardware, and encryption players, this analysis focuses strictly on Quantum eMotion and BTQ Technologies. These two stocks have captured the highest concentration of institutional volume, retail liquidity, and media attention within the Canadian public markets. Since QNC and BTQ serve as the primary sector benchmarks for public market investors, the vast valuation disconnect serves to illustrate the potential upside for 01 Quantum, as the Company successfully scales up its business.
Why the Market may be Discounting 01 Today
The discount appears understandable for several reasons. First, 01 Quantum remains a small company with limited liquidity and a narrower investor following. Second, investors may still be deciding how much weight to give development-fee revenue versus more recurring software-like economics. While revenue has begun to appear, the market is still waiting to see whether development-fee revenue can evolve into a more repeatable and scalable commercial model for 01 Quantum.
There are also narrative reasons for caution. Parts of the story, particularly digital asset economics and the longer-term AI platform vision, are tougher for investors to richly value until they are supported by contracts, usage data, or recurring revenue. Small-cap public markets often reward category association early but require harder proof before re-rating specific stocks on business fundamentals.
At the same time, this is often how valuation dislocations are created in emerging technology categories. The market notices the theme first and the execution story later.
The Pipeline and What it Could Mean
One of the more attractive features of the story is that the pipeline does not depend on a single moonshot outcome. 01 Quantum’s pipeline can be thought of in three layers.
Layer 1: Commercial Today
This includes the Hitachi Business Solutions Create, Ltd. remote access deployment, qLABS-related digital asset infrastructure, and development-led revenue already appearing in the financials.
Quantum-safe digital assets represent a large market opportunity as the industry prepares for the risk of harvest-now-decrypt-later attacks and the need to protect an estimated $4 trillion of digital assets before Q-Day. 01 Quantum created the $qONE token for the qLABS Foundation using its patent-pending Quantum Crypto Wrapper (“QCW”) and Quantum DeFi Wrapper (“QDW”) technologies, with the token generation event launched in early 2026. $qONE is positioned as the world’s first “Quantum Gas Fee” utility token, allowing users to quantum-lock and unlock existing cryptocurrencies such as ETH, SOL, and HYPE without requiring a new chain fork, while 01 Quantum earns development fees, ongoing royalty revenue, and token-sharing upside.
01 Quantum’s quantum-safe email security offering is designed to provide end-to-end post-quantum encryption and digital signatures in a format that is already mainstream-ready through an Outlook plug-in. The product is intended to support compliance with NIST-endorsed standards such as FIPS 203 and FIPS 204, while also addressing phishing, privacy, and secure enterprise communications. With pricing at $9.95 per month MSRP and $3 per month through channel partners, management frames the opportunity against a global base of roughly 730 million business email addresses, where 10% adoption at $3 per month would imply about $2.6 billion in annual recurring revenue.
Layer 2: Near-term Conversion
This includes additional enterprises, integrator-led projects, channel activity in Asia, and government or defence-adjacent opportunities described by management. These are important because they could expand the Company’s credibility beyond a small number of initial reference points.
Layer 3: Strategic Upside
This is the AI piece, particularly in privacy-preserving AI, where management believes the Company has already moved beyond proof of concept toward demonstrable encrypted inference and, potentially, a broader secure-AI platform.
01 Quantum’s Quantum AI Wrapper (“QAW”) is designed to encrypt both user data and the AI model itself using Fully Homomorphic Encryption (“FHE”), helping protect sensitive inputs, outputs, and model IP during inference. With a patent application filed, and notice of allowance received on May5th, 2026 management sees QAW as a way to address high-security verticals such as finance, government, and healthcare ($650 million QAW target segments), while the broader market for AI models is conservatively projected to reach $5.4 billion by 2032. The Company’s monetization path could include open-source support agreements, professional services, and managed services.
That layering matters. Investors do not need every part of the pipeline to hit at once. A few additional paid deployments could strengthen the remote-access and integration thesis materially. A first paid AI pilot could significantly change how investors value the story. A larger systems-integrator relationship could make the Company appear less like a niche product vendor and more like a specialized post-quantum infrastructure enabler, with synergies from larger distribution partners.
01 reported cash and equivalents of $3.36 million at January 31, 2026, and indicated current capital resources were sufficient to support its current level of operations and commercialization initiatives. Management separately said the company had no debt and an average recent cash burn of roughly $250,000 per quarter.
Framing the AI Opportunity
The AI angle may be the largest long-term opportunity in the story, but it is also the part that requires the most discipline in how it is framed.
The right way to think about it is not that every AI workflow will suddenly require fully homomorphic encryption or secure model hosting. Adoption will likely begin in higher-value use cases where confidentiality, model protection, and secure inference are key considerations..
But even that narrower starting point could be large. AI is spreading across financial services, healthcare, defence, insurance, telecom, legal workflows, industrial systems, and government operations. If even a narrow portion of those workloads requires encrypted inference, secure model hosting, or privacy-preserving execution, the serviceable opportunity could become much larger than a single product vertical.
A helpful way to think about 01 Quantum’s AI option is not as a conventional software seat story but as a trust layer for sensitive AI workflows. If enterprises conclude that certain AI use cases require secure and confidential execution environments, the economic model could extend beyond a development fee plus royalty business model into software licensing, integration fees, managed services, and potentially marketplace economics.
That is why the AI piece matters disproportionately to valuation. The stock may still be priced largely on the existing business and the constraints of being a small-cap disruptor, while the secure-AI platform angle introduces a second and potentially much larger valuation framework if management can establish product-market fit. This model is evident with higher profile AI companies such as OpenAI and Anthropic as well, as both companies are leaning into the “forward deployed engineer” or consulting model since typical consulting companies may not be able to execute on cutting technologies effectively, given how fast these technologies are evolving.
Key Investment Highlights
Here are six reasons investors may want to pay attention:
First, 01 Quantum appears to be one of the few publicly traded Canadian names in the category with live partner deployments and reported commercial revenue already demonstrating that the Company’s platform provides value to customers.
Second, the business model provides multiple ways to win. The Company can generate revenue from paid implementation and migration work, participate in royalties or revenue sharing, and retain upside if broader platform or partner adoption develops.
Third, the Company is operating in markets that are increasingly supported by standards, regulation, and government roadmaps. That matters because policy support can help pull customer budgets forward.
Fourth, the current valuation gap versus Canadian peers is wide enough that 01 Quantum may not need perfect execution to attract a market re-rating. It may simply need clearer proof that commercialization is durable.
Fifth, the AI piece introduces asymmetric upside. The market may be assigning little value to it today, but success there could materially expand how investors value the company.
Sixth, the balance sheet gives management time to pursue the current organic growth roadmap.
The Broader Opportunity
The most interesting aspect of the investment case is that the addressable opportunity will expand as AI adoption broadens.
As AI becomes a foundational layer of enterprise and government software, then security, privacy, and trust may become essential supporting infrastructure. In that scenario, 01 Quantum’s role is not just as a niche post-quantum vendor, but potentially as a provider of the security layer that allows sensitive AI applications to operate safely.
That does not mean the Company will capture that opportunity at scale. But it does mean the upside case is not limited to one product or one customer vertical. The larger strategic question is whether 01 Quantum can establish itself as an enabling layer across multiple security-sensitive AI and cryptographic workflows.
Conclusion
01 Quantum needs proof of repeatable contracts, broader commercialization, and disciplined execution. But on today’s numbers driven by real customer engagements, the market appears to be assigning limited value to the Company’s AI optionality and only partial value to its existing commercialization progress. The total addressable market (TAM) for 01 Quantum spans every industry using AI. If AI is the engine of the new economy PQC is the insurance policy. We estimate the “Trust Layer” for AI to be a multi-billion-dollar niche where 01 Quantum is an early mover.
That asymmetry is the heart of the opportunity: a modest current valuation, visible early partner traction, and exposure to a potentially much larger role in secure AI and post-quantum migration if execution continues. By focusing on an agile, API-driven software model, the company has bypassed hardware friction and achieved 304% YoY revenue growth in Q1 2026. 01 Quantum offers the exact same sovereign macroeconomic tailwinds as its peers, but with real revenues, live multinational deployments, and a lean capital structure, all trading at a 90%+ market capitalization discount to the sector averages.
Taken together, the three reports point to a simple conclusion: the post-quantum market is becoming real, the migration cycle has begun, and 01 Quantum appears to be one of the more underappreciated public companies attempting to monetize that shift through real products rather than pure research.
The next step for investors is straightforward: watch for more customer conversions, more recurring economics, and the first serious commercial proof points in AI.
Disclosures
01 Quantum Inc. [TSXV: ONE, OTCQB: OONEF] has contracted Sophic Capital for capital markets advisory and investor relations services.
Disclaimers
The information and recommendations made available through our emails, newsletters, website and press releases (collectively referred to as the “Material”) by Sophic Capital Inc. (“Sophic” or “Company”) is for informational purposes only and shall not be used or construed as an offer to sell or be used as a solicitation of an offer to buy any services or securities. In accessing or consuming the Materials, you hereby acknowledge that any reliance upon any Materials shall be at your sole risk. In particular, none of the information provided in our monthly newsletter and emails or any other Material should be viewed as an invite, and/or induce or encourage any person to make any kind of investment decision. The recommendations and information provided in our Material are not tailored to the needs of particular persons and may not be appropriate for you depending on your financial position or investment goals or needs. You should apply your own judgment in making any use of the information provided in the Company’s Material, especially as the basis for any investment decisions. Securities or other investments referred to in the Materials may not be suitable for you and you should not make any kind of investment decision in relation to them without first obtaining independent investment advice from a qualified and registered investment advisor. You further agree that neither Sophic, its, directors, officers, shareholders, employees, affiliates consultants, and/or clients will be liable for any losses or liabilities that may be occasioned as a result of the information provided in any of the Material. By accessing Sophic’s website and signing up to receive the Company’s monthly newsletter or any other Material, you accept and agree to be bound by and comply with the terms and conditions set out herein. If you do not accept and agree to the terms, you should not use the Company’s website or accept the terms and conditions associated to the newsletter signup. Sophic is not registered as an adviser or dealer under the securities legislation of any jurisdiction of Canada or elsewhere and provides Material on behalf of its clients pursuant to an exemption from the registration requirements that is available in respect of generic advice. In no event will Sophic be responsible or liable to you or any other party for any damages of any kind arising out of or relating to the use of, misuse of and/or inability to use the Company’s website or Material. The information is directed only at persons resident in Canada. The Company’s Material or the information provided in the Material shall not in any form constitute as an offer or solicitation to anyone in the United States of America or any jurisdiction where such offer or solicitation is not authorized or to any person to whom it is unlawful to make such a solicitation. If you choose to access Sophic’s website and/or have signed up to receive the Company’s monthly newsletter or any other Material, you acknowledge that the information in the Material is intended for use by persons resident in Canada only. Sophic is not an investment advisor nor does it maintain any registrations as such, and Material provided by Sophic shall not be used to make investment decisions. Information provided in the Company’s Material is often opinionated and should be considered for information purposes only. No stock exchange or securities regulatory authority anywhere has approved or disapproved of the information contained herein. There is no express or implied solicitation to buy or sell securities. Sophic and/or its principals and employees may have positions in the stocks mentioned in the Company’s Material and may trade in the stocks mentioned in the Material. Do not consider buying or selling any stock without conducting your own due diligence and/or without obtaining independent investment advice from a qualified and registered investment advisor. The Company has not independently verified any of the data from third party sources referred to in the Material, including information provided by Sophic clients that are the subject of the report, or ascertained the underlying assumptions relied upon by such sources. The Company does not assume any responsibility for the accuracy or completeness of this information or for any failure by any such other persons to disclose events which may have occurred or may affect the significance or accuracy of any such information.
The Material may contain forward looking information. Forward-looking statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,” “intends,” “estimates,” “potential,” “possible,” “projects,” “plans,” and similar expressions, or statements that events, conditions or results “will,” “may,” “could,” or “should” occur or be achieved or their negatives or other comparable words and include, without limitation, statements regarding, projected revenue, income or earnings or other results of operations, strategy, plans, objectives, goals and targets, plans to increase market share or with respect to anticipated performance compared to competitors, product development and adoption by potential customers. These statements relate to future events and future performance. Forward-looking statements are based on opinions and assumptions as of the date made, and are subject to a variety of risks and other factors that could cause actual events/results to differ materially from these forward looking statements. There can be no assurance that such expectations will prove to be correct; these statements are no guarantee of future performance and involve known and unknown risks, uncertainties and other factors. Sophic provides no assurance as to future results, performance, or achievements and no representations are made that actual results achieved will be as indicated in the forward looking information. Nothing herein can be assumed or predicted, and you are strongly encouraged to learn more and seek independent advice before relying on any information presented.
