While quantum computing may appear as a concept from science fiction, it is rapidly becoming a reality that investment firms must confront. As innovation accelerates, the need to enhance data security against potential quantum threats is critical. In the first quarter of 2025, investments in quantum technologies surpassed $1.25 billion, signaling a shift from development to practical implementation.
As these quantum technologies advance, the risks associated with current encryption methods become increasingly evident. Cybersecurity experts refer to the day when quantum computers can break existing encryption as Q-Day. Although this pivotal moment has not yet arrived, the threat posed by malicious actors capable of intercepting encrypted data today for future decryption remains a significant concern.
Understanding the quantum threat
To understand the risks linked to quantum computing, it is essential to examine how modern cryptographic systems operate. Digital data—whether text, images, or numbers—is represented in binary format, facilitating seamless communication across global networks. Encryption protects this communication by converting original binary sequences into unreadable formats through complex mathematical processes.
This protective mechanism secures sensitive information, including client records, trading details, and internal communications. It also underpins the algorithms that ensure privacy and security in blockchain technology. There are primarily two types of encryption: private-key and public-key, each with distinct methods and vulnerabilities.
The vulnerability of public-key encryption
The RSA algorithm, a cornerstone of public-key encryption widely used in financial systems, relies on the difficulty of factoring large prime numbers. The security of RSA does not depend on the secrecy of the method itself but on the computational challenge it presents to classical computers. However, this reliance exposes a vulnerability as quantum computing progresses.
In the 1990s, Peter Shor, a notable computer scientist, introduced an algorithm that can efficiently factor large integers, posing a direct threat to RSA and similar systems. Initially regarded as a theoretical concept due to the limitations of quantum hardware, Shor’s algorithm is becoming increasingly relevant as advancements in quantum technology continue.
Proactive measures for investment firms
As quantum computing capabilities improve, the resources needed to breach RSA encryption are significantly diminishing. Recent estimates indicate that the number of qubits required to compromise RSA has decreased from 20 million in 2019 to less than 1 million by 2025. For context, Google’s 105-qubit quantum processor can perform calculations in minutes that would take conventional supercomputers trillions of years to complete.
The implications of these developments are profound, affecting various sectors, including finance and government. Unlike typical cyberattacks, breaches enabled by quantum computing could occur without detection, presenting a systemic risk that could undermine trust in digital infrastructures.
Strategies to mitigate risks
Investment firms must adopt a proactive stance to safeguard against future quantum threats. The phrase harvest now, decrypt later encapsulates the urgency for organizations to bolster their security measures before Q-Day arrives. Once this threshold is crossed, historical data could become vulnerable.
Two primary strategies are emerging to strengthen defenses: Post-Quantum Cryptography (PQC) and Quantum Key Distribution (QKD). PQC enhances existing digital systems with new mathematical algorithms designed to withstand quantum attacks without depending on quantum phenomena. However, while PQC offers a short-term defense, it is not a permanent solution, as future advancements may render even these algorithms obsolete.
As these quantum technologies advance, the risks associated with current encryption methods become increasingly evident. Cybersecurity experts refer to the day when quantum computers can break existing encryption as Q-Day. Although this pivotal moment has not yet arrived, the threat posed by malicious actors capable of intercepting encrypted data today for future decryption remains a significant concern.0
Future considerations and collaborative efforts
As these quantum technologies advance, the risks associated with current encryption methods become increasingly evident. Cybersecurity experts refer to the day when quantum computers can break existing encryption as Q-Day. Although this pivotal moment has not yet arrived, the threat posed by malicious actors capable of intercepting encrypted data today for future decryption remains a significant concern.1
As these quantum technologies advance, the risks associated with current encryption methods become increasingly evident. Cybersecurity experts refer to the day when quantum computers can break existing encryption as Q-Day. Although this pivotal moment has not yet arrived, the threat posed by malicious actors capable of intercepting encrypted data today for future decryption remains a significant concern.2
As these quantum technologies advance, the risks associated with current encryption methods become increasingly evident. Cybersecurity experts refer to the day when quantum computers can break existing encryption as Q-Day. Although this pivotal moment has not yet arrived, the threat posed by malicious actors capable of intercepting encrypted data today for future decryption remains a significant concern.3
As these quantum technologies advance, the risks associated with current encryption methods become increasingly evident. Cybersecurity experts refer to the day when quantum computers can break existing encryption as Q-Day. Although this pivotal moment has not yet arrived, the threat posed by malicious actors capable of intercepting encrypted data today for future decryption remains a significant concern.4