PsiQuantum’s New Quantum Facility: Cybersecurity Implications
By Carlotta Kozlowskyj | 22 October 2025
Adi Goldstein/Unsplash
Summary
PsiQuantum’s USD 1b investment is a significant step towards building the world’s first commercially viable fault-tolerant quantum computer.
PsiQuatum aims to overcome long-standing obstacles to scaling quantum systems by using photonic qubits.
This investment will very likely accelerate the development of Quantum Computers (QCs) able to break today’s encryption methods, posing major cybersecurity challenges.
Context
PsiQuantum was co-founded in 2016 by 4 quantum physicists: Jeremy O’Brien, Terry Rudolph, Mark Thompson, and Pete Shadbolt, to create a commercial quantum computer based on photonic qubits and mature semiconductor manufacturing processes. PsiQuatum aims to build the 1st US million-scale, fault-tolerant quantum computer in Chicago, developed in partnership with the state of Illinois. It is competing against teams worldwide to build a commercial fault-tolerant system. A key reason large-scale QCs have not yet been developed, despite the significant investments, is that qubits are extremely sensitive, as even minor temperature changes or cosmic rays can cause errors. Unlike competitors such as Google, which rely on superconducting qubits and electrons, PsiQuantum uses photonic qubits (light), which are less sensitive to environmental changes, to overcome the challenges of qubit vulnerability. Photonic qubits at scale could make large-scale, fault-tolerant QCs technically achievable, not just theoretically.
PsiQuantum announced on 10 September 2025 that it had raised USD 1b in funding to build the world’s first commercial fault-tolerant quantum computers. The investment, led mainly by BlackRock affiliates, values PsiQuantum at USD 7b, positioning it in an advantageous position for the global race in commercialising QCs. The quantum computing technology market is estimated to reach a global market value of USD 1t by 2035. The USD 1b investment is decisive, as it will likely accelerate the development of QCs. The US could become the first state to possess large-scale quantum capabilities, giving it an edge in cybersecurity and decryption. PsiQuantum has also begun to expand internationally, with the opening of its first UK-based research and development facility in October 2023 at Daresbury Laboratory in the Liverpool City Region, supported by a USD 12m UK government funding. This highlights the geopolitical significance of QC technological advancements. As underlined in BISI’s recent report, this development is also geopolitically important as China is simultaneously accelerating its investments in Quantum computing, to compete with the US.
Quantum Computers and Security Challenges
QCs are the next generation of supercomputing platforms, reducing the time it takes to process data and run algorithms. Quantum computers use qubits to process information, instead of standard bits, which can exist in a superposition of 0 and 1 at the same time, allowing QCs to perform many calculations simultaneously. QCs would revolutionise computer power by processing operations in seconds or microseconds, whereas classical computers would take hundreds or thousands of years. This may render old encryption methods obsolete and ineffective rapidly.
Large-scale fault-tolerant QCs would pose significant cybersecurity challenges as it has the potential to undermine existing cryptographic systems. It would render traditional public-key encryption methods, such as RSA, Elliptic Curve Cryptography (ECC), and Diffie-Hellman (DH), which are currently indecipherable for classical computers, obsolete. While this remains a theoretical concern, as existing QCs lack the capacity to decrypt today’s encryption techniques, PsiQuantum’s investment could considerably speed up the development of QCs. Beyond the cybersecurity risks of highlighted in BISI’s report, the rise of quantum cryptanalysis has geopolitical implications. PsiQuantum's progress is particularly significant for China, as it directly challenges Beijing’s ambition to lead the global quantum technology race. In response, China will likely intensify its efforts to shift investment from fundamental research towards scalable production. This growing technological competition is already creating friction between China and the US, constraining scientific collaboration and reinforcing trade restrictions on QC components of QCs, as Quantum technology is associated with national security. Consequently, PsiQuantum’s investment could not only reshape cybersecurity and cryptography but also deepen the geopolitical and bilateral tensions between the US and China.
Forecast
Short-term (Now - 3 months)
It is likely that PsiQuantum will use the $1B to expand its Chicago facility and begin large-scale testing of QCs using photonic qubit systems.
It is likely that governments, especially the UK and the US, will increasingly seek to form and deepen strategic partnerships with PsiQuatum to ensure their access to this new cybersecurity technology.
There is a realistic possibility that today’s data will be stored and decrypted if QC technology is developed on a large-scale.
Long-term (>1 year)
It is likely that other states, such as China, will compete with the US and PsiQuantum, transforming quantum technology into a global race.
It is likely that large-scale fault-default QCs will be developed by PsiQuantum or other organisations, transforming cybersecurity strategies and potentially giving the US and its allies a significant quantum encryption advantage.
It is likely that governments will urge businesses and governmental organisations to be prepared against the cybersecurity risks posed by QCs.
