US Government Explores Equity Stakes in Quantum Computing Companies Through CHIPS Program

Strategic Shift in Federal Technology Investment

The US Commerce Department is considering taking equity positions in American quantum computing companies through its CHIPS program, according to reports from The Wall Street Journal. This potential move would represent a fundamental shift in how Washington supports strategic technology sectors, moving away from traditional grants toward direct government ownership stakes in private companies.

Strategic Shift in Federal Technology Investment
Expanding Government’s Role in Strategic Technologies
Precedent in Semiconductor Industry
Industry Response and Leadership
Technical Challenges and Future Outlook

Sources familiar with the discussions indicate the department has held preliminary talks with several leading quantum computing firms, including IonQ, Rigetti Computing, and D-Wave Quantum. The proposals reportedly involve minimum funding levels of approximately $10 million per company, though final terms remain undetermined according to officials familiar with the negotiations.

Expanding Government’s Role in Strategic Technologies

The potential equity-based partnerships signal Washington’s growing recognition of quantum technology as a national priority rather than merely a niche research area, analysts suggest. Quantum systems, which rely on qubits instead of traditional binary bits, theoretically can solve complex problems far faster than conventional computers in fields including materials science, pharmaceutical development, and logistics optimization.

Funding would flow through the Commerce Department’s Chips Research and Development Office, which was reorganized earlier this year by Commerce Secretary Gina Raimondo to centralize oversight of industry partnerships under the 2022 CHIPS Act program. Officials familiar with the plan say the agency is weighing whether to structure investments as direct equity, convertible warrants, or royalty agreements.

Precedent in Semiconductor Industry

This approach mirrors the government’s previous deal with Intel, where the Commerce Department converted $9 billion in CHIPS Act grants into an approximately 10 percent stake in the chipmaker earlier this year. That transaction made the US government Intel’s largest shareholder and marked one of the first significant conversions of industrial subsidies into direct equity., according to market analysis

Similar arrangements have reportedly been reached with MP Materials and Lithium Americas, both key suppliers of rare-earth minerals and battery materials. The proposed quantum computing investments would represent the government’s first major ownership venture in this specific sector, according to the analysis.

Industry Response and Leadership

Deputy Commerce Secretary Paul Dabbar, a former energy official with background in quantum computing, is said to be leading the department’s engagement with the industry. A Commerce Department representative confirmed that Dabbar’s former company, Bohr Quantum Technology, is not being considered for funding.

Industry leaders have responded positively to the potential government participation. Quantum Computing CEO Yuping Huang described the potential equity involvement as “an encouraging signal” of federal confidence in the technology‘s commercial future. A Rigetti spokesperson confirmed the company remains in “ongoing dialogue” with government officials about funding opportunities, while D-Wave’s head of government relations emphasized aligning government use cases with measurable returns on public investment.

Technical Challenges and Future Outlook

Although practical quantum computing remains limited by qubit stability and error correction challenges, researchers expect rapid advances as hardware scales and hybrid quantum-classical frameworks mature. The government’s potential equity participation comes as the technology transitions from theoretical research toward practical applications with national security and economic competitiveness implications.

The discussions highlight the evolving relationship between government and private sector in developing technologies deemed critical to national interests. As one analyst noted, this approach allows taxpayers to potentially benefit from the financial upside of successful ventures that received public support, while ensuring the government maintains strategic influence in key technological domains.