October 20, 2025
Every time you shop online with your credit card, install an update on your phone or send a confidential file to a co-worker, internet security protocols help keep your data safe. These encryption systems protect billions of transactions and communications every day, using algorithms too difficult for conventional computers to break. Even a hacker wielding the most powerful supercomputer would need millions of years to land on the right passkey.
But with a new device called a quantum computer, they could crack the code in hours. While these machines have the potential to help scientists discover blockbuster medicines or design high-efficiency batteries, they could also allow crime syndicates or state-sponsored hackers to shatter the bedrock of digital security.
Although quantum computers aren’t an immediate danger, the threat is real — and growing. The smart move is to prepare now, not to panic later.
Quantum computers are a new kind of technology that uses the principles of quantum physics to tackle problems that are extremely hard — or even impossible — for today’s computers to solve. Like traditional computers, they store information using bits, which are usually represented as 0s and 1s.
In a regular computer, these bits are created using electrical signals that are either on or off. Quantum computers, however, use tiny particles called qubits. Thanks to a quantum property called superposition, qubits can be in a mix of 0 and 1 at the same time. This allows quantum computers to explore many possible solutions at once, rather than one at a time.
Quantum computing is powerful because it works in a completely different way from conventional computers. Qubits can represent multiple possibilities at once, which means a quantum computer can process a huge number of potential solutions simultaneously.
This leads to exponential growth in computing power: Each new qubit doubles the number of states the computer can handle. For example, two qubits can represent four combinations, three qubits can represent eight, and 50 qubits can represent over a quadrillion combinations. This makes quantum computers especially promising for tasks like simulating molecules, cracking encryption, or solving complex optimization problems.
The danger of quantum computing is that it could break the encryption systems that protect our digital world — including online banking, emails and secure websites. Sensitive information would be exposed, financial systems compromised and the digital backbone of entire industries undermined.
Encryption works by transforming sensitive information into a format unreadable by anyone who does not possess the key, a code for scrambling and unscrambling the data. Many of today’s encryption algorithms rely on one-way functions, which are far simpler to compute in one direction than in reverse. For example, computers can multiply two 40-digit prime numbers in a fraction of a second, but it would take an astronomical amount of brute-force guessing to determine the factors from the result. This difficulty forms the basis of digital security: Once these algorithms encrypt the strings of numbers that computers use to represent information, reversing the operation is all but impossible without the key.
However, by testing vast numbers of possible solutions simultaneously, quantum computers could smash through this mathematical barrier, especially with the aid of algorithms that make the process more efficient (but still too time-consuming for a classical computer). While a supercomputer might need millions of years to break a modern cryptosystem, a quantum computer with 20 million qubits could do the job in eight hours.
Shor’s algorithm, developed by Peter Shor in 1994, allows a quantum computer to factor large numbers exponentially faster than classical computers, which would break the mathematical foundation of encryption systems like RSA, which is widely used for digital security.
Quantum computing won’t post a threat to cryptography for at least 10 to 20 years, according to experts. These computers are difficult to build and run. Current models contain 1,000 qubits at most, with no clear route to scaling to the numbers necessary to break today’s encryption systems.
However, as with any emerging technology, breakthroughs may always be imminent. Governments and large enterprises are supporting the quest to build large-scale quantum computers, and improvements continue to appear.
Quantum computing is not a threat today, but bad actors could use conventional methods to harvest data in anticipation of a capable quantum computer. In a strategy called “harvest now, decrypt later” (HNDL), attackers may already be stealing encrypted information to decode when large-scale quantum computers become widely available.
The organizations that should begin planning for quantum attacks are those storing sensitive data for a long time, such as banks, healthcare systems and governments. Everyday transactions like card payments are less vulnerable because they are protected by encryption that is not threatened by quantum.
Organizations can prepare for quantum computing by planning now, rather than waiting until the technology matures — and those organizations running critical infrastructure in the EU must transition to post-quantum cryptography by 2030. Other countries are considering or are already implementing similar regulations.
Governments and large companies are already investing billions in quantum safeguards; smaller businesses should prioritize low-cost fixes to make as soon as possible.
A crucial first step is to assess what value the organization’s current data might hold to hackers decades down the road. Then, to protect that data, they can adopt new approaches to encryption — called post-quantum cryptography (PQC) — that are resistant to quantum attacks.
Post-quantum cryptography is the collective term for new encryption methods designed to resist attacks from quantum computers. Around the world, standardization bodies and government agencies have been developing PQC standards to help speed the transition to quantum-safe security systems.
Because PQC strengthens conventional cryptographic algorithms, it does not typically require extensive upgrades to existing hardware.
Banks should prepare for quantum computing by picking a quantum-safe signature scheme and deciding how to certify and communicate it. The U.S. Department of Commerce’s National Institute of Standards and Technology last year finalized its principal set of encryption algorithms designed to withstand cyberattacks from a quantum computer.
But there is no need to rush to migrate entirely to PQC — the current risk to banks is low, and standards are still evolving.
Nevertheless, every financial institution should invest in cryptographic inventory tools — examples include QVision, AQtive Guard, IBM Guardium Quantum Safe and CipherInsights — that can help them determine what encryption they use, where keys and certificates are and what data is most sensitive. This inventory is a win-win: It helps now and makes future migration easier.
The bottom line is that, while the financial industry has handled cryptography migrations before, the changes necessary to counter the quantum threat will be especially disruptive — presenting technological, operational, regulatory and strategic challenges. Timing and planning will be critical.
As they keep an eye on new developments in quantum computing, banks should adopt hybrid solutions where practical. Full PQC migration can come later, once standards mature and the threat becomes clearer.