- Quantum computing is threatening today’s encryption standards faster than expected
- Google and Cloudflare accelerate PQC migration targets to 2029
- Organizations should prioritize PQC spending alongside AI
Credit rating giant Moody's Ratings has warned that organizations could be underestimating just how quickly quantum computing could threaten current encryption standards, to the point that slow post-quantum cryptography adoption could even post a credit risk.
And industry giants are already starting to recognize this, with Google and Cloudflare having moved their targets to 2029 – a seriously big shift compared with the 2035 US government target for national security systems.
With these changes showing that some of the world’s most sophisticated internet infrastructure companies are worried about the speed of change, Moody’s argues that companies may no longer have the decade or more they thought to upgrade.
Strategic investment will secure systems before PQC is a major risk
Currently, most internet security depends on public-key cryptography. This includes online banking, payment platforms, digital identities, VPNs and secure government systems.
However, quantum computers threaten this because algorithms like Shor’s Algorithm could theoretically solve problems much, much faster than classic computers, essentially breaking down the cryptography and enabling access for attackers.
Until recently, we thought that millions of qubits would be needed before quantum systems were able to break current encryption standards, but it’s been revealed that around 10,000 qubits are sufficient to execute Shor’s Algorithm against today’s encryption standards.
Beyond that, around 26,000 qubits could potentially break P-256 – a standardized elliptic curve algorithm used commonly in financial services and government systems.
The report references Google Quantum AI research, which points toward a 20-fold decrease in the computing resources required to break secure elliptic curve cryptography compared with previous estimates.
In March 2026, Google announced it would be accelerating its PQC migration target to 2029. Cloudflare followed suit in April, reflecting that 2029 target. “This indicates that two of the world's most technically sophisticated operators of internet infrastructure have separately concluded that their existing planning horizon is no longer adequate,” the company noted.
Why PQC spend is just as important as investing in AI
With AI budgets dominating IT spend, Moody’s is now suggesting that PQC spend could compete with existing AI and IT budgets, but only if companies fully understand the risks. That’s because AI investments offer revenue growth opportunities and productivity improvements, but PQC migration doesn’t unlock any extra revenue or show tangible benefits to customers.
Getting in on the action early could actually be the smarter move, though. The company predicts that PQC migration could account for 2.5% of annual IT budgets now, but those who delay until 2030 could spend twice as much trying to catch up.
Alarmingly, Moody’s warns of a ‘harvest now, decrypt later’ threat. Attackers can steal encrypted data now, archive them, and wait for future quantum systems to become capable of decrypting the information.
As for costs, the White House previously estimated that migrating federal systems could cost around $7.1 billion over 10 years.
The secondary problem, the report warns, is that hyperscalers would need to adjust their infrastructure strategies to adapt. While a current cryptographic connection requires around 64 bytes, hybrid PQC connections require around 1,568 bytes – a 24x increase in the volume of data being transmitted.
As a result, the likes of Google, Cloudflare and others will need to continue to build out AI infrastructure while also upgrading infrastructure for post-quantum cryptography.
While the immediate, transformative potential of AI investment is undeniable, this shift serves as a reminder not to ignore the threat quantum computing poses to current cryptography.
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