Japan is racing to develop "unbreakable" quantum encryption by 2030. Chinese hackers breached US wiretap systems, Japan is tackling AI deepfake scams, and China is advancing silicon photonics to evade US tech bans. The cybersecurity competition is intensifying.
Welcome back to midweek “Cyber Bites,” your quick digest on the latest battles in global cybersecurity! This week, Japan takes a bold step toward “unbreakable” data protection, announcing an ambitious goal to develop quantum encryption by 2030. Meanwhile, Chinese hackers, known as Salt Typhoon, have slipped undetected into major US broadband networks like Verizon and AT&T, reportedly snooping on federal wiretaps.
On the tech front, Japan grapples with a surge in AI-powered deepfake scams that are shredding language barriers and opening new doors for scammers. Across the cyber field, China’s JFS Laboratory in Wuhan claims a breakthrough in silicon photonics, marking a strategic step towards semiconductor independence despite US sanctions. All the global cyber drama—bitesized for you!
In a bold move towards data security, Japan is advancing a national initiative to develop "unbreakable" quantum encryption technology by 2030. Enlisting prominent firms like Toshiba and NEC, the Ministry of Internal Affairs and Communications is preparing a five-year project backed by a substantial investment of tens of billions of yen. This quantum encryption program is vital as quantum computing nears practical use, posing risks to existing encryption systems used online today.
"Safeguarding data with home-grown technology is essential," says Mikio Fujiwara,
The director general of the National Institute of Information and Communications Technology's (NICT) quantum research centre, highlighting the significance of secure information systems in fields such as medicine.
Japan’s NICT already launched a test network in Tokyo, connecting government, financial, and telecom entities as a foundation for quantum communication trials. While Japanese companies excel in quantum key generation, their global counterparts like China and the EU lead in extensive application research, with China operating a multi-thousand-kilometre secure network and testing satellite-based encrypted communication. To gain momentum in this competitive arena, Japan’s effort will prioritize building local expertise in quantum encryption development.
For Japan, "it is essential to ensure a steady development of talent that anticipates the future of quantum communications, including encryption," said Tomoyuki Horikiri, professor at Yokohama National University.
Chinese cyber group Salt Typhoon has reportedly infiltrated networks of major US broadband providers, including Verizon, AT&T, and Lumen, compromising systems used by the Federal government for court-authorised wiretapping. According to The Washington Post, US officials suspect the hackers aimed "in part at discovering the Chinese targets of American surveillance." Salt Typhoon remained undetected within these networks for several months, during which they exfiltrated data and reconfigured key equipment.
The FBI, the Department of Homeland Security, and various US intelligence agencies are now investigating this serious breach. In Verizon’s case, the attackers extracted sensitive data by manipulating Cisco routers, a tactic highlighting the sophistication of Salt Typhoon's methods. Representatives from Verizon, AT&T, and Lumen have not commented on the incident, underscoring the sensitive nature of the investigation.
Japan is witnessing a significant increase in AI-driven deepfake scams, where sophisticated generative AI tools are dismantling the language barrier that once provided a layer of protection. A report from British firm Sumsub reveals a 28-fold surge in Japanese deepfake cases last year, driven by scammers now able to replicate native-level Japanese audio and video.
Deepfake technology has extended the reach of financial scams, previously limited by linguistic hurdles, and has shown a 243% increase in Japan’s scam rate over the past year. "Fraudulent phone calls that use artificial audio that mimics the voice of a relative are also a concern," says Junichi Yamagishi, a professor at Tokyo’s National Institute of Informatics.
With tools for generating artificial language content readily available, fraudsters are leveraging AI for both audio and visual deepfakes. Notably, cases of high-stakes corporate fraud, such as the 200-million-HKD scam in the U.K. involving a fake video call, underscore the growing danger. In response, Japanese authorities and private-sector firms are implementing deepfake detection solutions to fortify their defense against this evolving cybersecurity threat.
Source: X, prompt: cyber chip
A recent breakthrough in silicon photonics by JFS Laboratory, a state-backed lab in Wuhan, marks a pivotal advancement in China’s semiconductor self-sufficiency amidst ongoing US sanctions. JFS succeeded in integrating a laser light source with a silicon chip, filling "one of the few blanks" in the field, according to Chinese state media. Silicon photonics uses optical rather than electrical signals for chip communication, a technological shift seen as essential in overcoming the physical limits of traditional chip design.
"A good silicon photonics integration system could address critical issues in energy efficiency and computing power in the AI era,"
remarked Douglas Yu Chen-hua of Taiwan Semiconductor Manufacturing Company.
This development reflects China’s strategic focus on alternative chip technologies that bypass reliance on advanced EUV lithography, monopolized by Dutch company ASML. With global silicon photonics markets expected to rise to $7.86 billion by 2030, this breakthrough could position China to capitalize on emerging semiconductor frontiers while alleviating the impact of US-led export restrictions on traditional chip technologies.
A Chinese ship captain has been charged in Taiwan for deliberately damaging a subsea cable, marking a rare prosecution tied to infrastructure sabotage. The case highlights growing concerns over global undersea cable vulnerabilities amid rising tensions with China.
Australia is facing a double threat to its financial security: cyberattacks on major superannuation funds and the fallout from Trump’s “Liberation Day” tariff declaration. Both have exposed deep vulnerabilities in retirement savings, leaving Australia’s future wealth increasingly at risk.
Major cyber alliances are buckling. Australia’s super funds are under digital siege, the US slashes cyber defenses, and Five Eyes unity is faltering. As threats mount from China and Russia, the West’s fractured response risks emboldening adversaries and weakening global cyber resilience.
A coordinated cyberattack hit Australia’s largest pension funds, compromising over 20,000 accounts. Hackers targeted retirees for fraud, exploiting weak authentication. The breach exposed major gaps in super fund security and shook public trust in the $3.5T industry.
