The threat centers on the anticipated future capability of quantum computers to break current public-key cryptographic systems such as RSA and ECC, which underpin the security of most digital communications and data protection mechanisms today. Quantum algorithms like Shor's algorithm theoretically enable efficient factorization of large integers and discrete logarithms, rendering classical asymmetric encryption vulnerable. Despite the significant technical challenges in building scalable, fault-tolerant quantum computers, experts estimate that such machines could emerge within one to two decades. This timeline urges industries, particularly financial services and other sectors relying heavily on secure communications, to prepare for a post-quantum cryptographic landscape. The threat does not involve an immediate exploit but represents a strategic vulnerability that could compromise confidentiality, integrity, and availability of sensitive data once quantum decryption becomes feasible. Preparation includes adopting quantum-resistant algorithms standardized by bodies like NIST, updating cryptographic protocols, and ensuring cryptographic agility in systems. The absence of known exploits in the wild currently limits immediate risk, but the long-term implications are profound, necessitating early and sustained mitigation efforts.

For European organizations, the emergence of quantum computers capable of breaking public-key encryption threatens the confidentiality of sensitive financial transactions, personal data, and intellectual property. The integrity of communications and digital signatures could also be compromised, leading to fraud, data breaches, and loss of trust. Critical infrastructure sectors, including banking, healthcare, and government services, may face operational disruptions if cryptographic protections fail. The financial industry, a cornerstone of many European economies, is particularly vulnerable due to its reliance on secure digital transactions and communications. Failure to transition to quantum-resistant cryptography in time could result in widespread exposure of encrypted data, including historical data that was previously considered secure. This could have cascading effects on regulatory compliance, legal liabilities, and economic stability. However, the threat remains medium in severity currently due to the lack of immediate exploitability and the extended timeline for quantum computer development.

European organizations should begin by conducting comprehensive inventories of cryptographic assets and identifying systems dependent on vulnerable public-key algorithms. They should engage with emerging post-quantum cryptography standards, such as those being developed by NIST, and plan phased migration strategies to quantum-resistant algorithms like lattice-based, hash-based, or code-based cryptography. Implementing cryptographic agility—designing systems capable of switching algorithms without major overhauls—is critical to future-proof defenses. Organizations should also invest in staff training and awareness to understand quantum risks and mitigation strategies. Collaboration with industry groups, regulators, and cybersecurity vendors to stay updated on quantum advancements and best practices is essential. Additionally, organizations should consider encrypting sensitive data with hybrid schemes combining classical and quantum-resistant algorithms during the transition period. Regularly reviewing and updating incident response plans to include quantum-related scenarios will enhance preparedness. Finally, European policymakers should support research and development in quantum-safe technologies and promote standards adoption across critical sectors.