2025 Cyber Report: The Stakes Get Higher
As the global security situation continues to deteriorate, the pressure in the military cyber domain just keeps increasing. So, what does this reality mean to Canada and its allies, at a time when the United States’ status as a reliable partner can no longer be taken for granted? In this year’s Cyber Report, we asked Ottawa Bureau Chief, James Careless, to tackle this topic with the help of Major General Dave Yarker, Commander of the Canadian Armed Forces Cyber Command (CAFCYBERCOM), plus some key experts from Canada’s defence IT industry. Here is our report.
To get an accurate assessment of the cyber threats facing Canada, CDR turned to CAFCYBERCOM’s Major General Yarker. He spent close to 15 years addressing issues related to military cyber operations and cyber security, before assuming the leadership of CAFCYBERCOM in September 2024.
According to MGen Yarker, the CAF is facing daily cyber challenges and threats on its devices, computer systems, weapon systems, and within its IT infrastructure. “Emerging and ever-changing digital technologies have opened the door to a range of new cyber threats,” he told CDR. “Nation-state actors and state-sponsored groups are actively seeking to exploit vulnerabilities in our cyber systems for espionage, sabotage, data theft, and to gain a military and informational advantage. Artificial Intelligence (AI) technologies are lowering the barriers to entry and enhancing the quality, scale, and precision of malicious cyber threat activity.”
To make matters worse, “the People’s Republic of China (PCR), Russia, and the Democratic People’s Republic of Korea (DPRK), are all actively engaged in the cyber domain to pursue their strategic objectives and all have made, and continue to make, substantial investments in cyber capabilities,” said MGen Yarker. “One of our closest partners, the Canadian Centre for Cyber Security (CCCS) under the CSE, has released its threat assessment for 2025-26, which speaks clearly about the PRC’s comprehensive and aggressive cyber program. It poses the most sophisticated state cyber threat to Canada. The PRC targets Canadian interests for political and commercial gains through espionage, intellectual property theft, and transnational repression and the CAF is not spared its attention.”
Russia poses a similar threat to our cyber security, driven by “Moscow’s ambitions to confront and destabilize Canada and our allies,” he said. “Canada is a valuable espionage target for Russian state-sponsored cyber threat actors, including through supply chain compromises, given Canada’s membership in the North Atlantic Treaty Organization [NATO], support for Ukraine against Russian aggression, and presence in the Arctic.” Meanwhile, “DPRK state-sponsored cyber threat actors routinely engage in cybercrime activities, such as ransomware and cryptocurrency theft, to fund the regime’s political and military ambitions as well as the cyber program’s own operations,” said MGen Yarker.
In the face of these cyber threats and others, “Our overarching objective remains steadfast: to fortify information safeguards and facilitate the sharing of threat intelligence, ensuring our operational capabilities and personnel remain secure, resilient, and adequately prepared to respond to cyber events,” he said. “In collaboration with various Government of Canada departments, industry partners, and supporting agencies, DND/CAF maintains a vigilant watch over the ever-evolving cyber domain. We work alongside the Treasury Board Secretariat (TBS), CSE, CCCS, Shared Services Canada and other government entities to constantly refine our engagement methods with industry partners. These help us drive security, resilience, and forge partnerships to achieve shared cyber security goals.”
In a world of AI and other software-driven advances, discussions about cyber security tend to conjure up “images of high technology,” said MGen Yarker. However, “the conduct of operations in cyberspace is fundamentally about people — people with innovative knowledge and the will to use that knowledge to achieve outstanding outcomes in the face of challenging adversaries.”
This is why the CAF and DND must keep investing in cyber security education and training for Canadian government/defence employees to raise their awareness of cyber threats such as ‘phishing emails’, because many security breaches are still being caused by people innocently clicking on malware-connected web links. At the same time, CAF/DND must stay on top of the latest cyber threat trends. “Deepening our understanding of cyber threats enables us to enhance our readiness and, as threats evolve, we can continue to look for new ways to combat them,” MGen Yarker said.
As for the impact of the strained Canada/US relationship on Canadian cyber security?
MGen Yarker does not appear to be unduly alarmed. “DND/CAF shares a deep defence relationship with the US military, on the continent and abroad,” he said. “Our mutual objectives of strengthening continental defence and safeguarding global peace and security have led to close cooperation between our respective defence and national security agencies.”
However, what does concern the Commander of CAFCYBERCOM is finding qualified experts to aid Canada in its defence against cyber attackers. “People capable of leading in the cyber security domain are in short supply,” said MGen Yarker. “It requires years of experience to develop with deliberate and dedicated career focus. This is the largest gap, and not just for the CAF.” This is why the modernization of the Canadian military’s recruitment process and retention of its CAF members “is our Number One priority,” he said. “Indeed, against a backdrop of a lack of cyber security experts CAF is actively developing that critical talent pool.”
Fortunately for the CAF and DND, there are many Canadian firms with the expertise and know-how to assist in Canada’s fight against cyber threats. In the next part of the 2025 Cyber Report, we will hear from a number of them.
Worth noting: This year, the CAFCYBERCOM successfully participated in Exercise LOCKED SHIELDS 2025 – the world’s largest and most complex live-fire cyber defence exercise. A key component of this annual NATO event is the Strategic Decision-Making Exercise (STRATEX), which tests the ability of Allied and partner nations to respond to evolving cyber threats at the strategic and operational levels. Held from May 5 to 9, 2025, Exercise LOCKED SHIELDS 2025 brought together approximately 4,000 participants from 41 nations. Organized by the NATO Cooperative Cyber Defence Centre of Excellence (CCDCOE), the exercise focused on real-time decision-making and coordination in the face of simulated cyber incidents. A key focus for Canada was its engagement in Seoul, Republic of Korea, where 11 Canadian experts from CAFCYBERCOM, Department of National Defence, Global Affairs Canada, Public Safety Canada and the Royal Canadian Mounted Police worked closely with the National Cyber Security Center (NCSC), the Republic of Korea Armed Forces’ Cyber Operations Command, and other global partners. More than 200 South Korean military and civilian cyber personnel trained alongside Canadian experts, reinforcing international collaboration in cyber defence.
ADGA GROUP
ADGA Group (ADGA) is an Ottawa-based defence and security technology company that employs an integrated approach to security across cyber and physical domains. Allan McDougall is ADGA’s Senior Security Program Manager.
Although McDougall is appreciative of MGen Yarker’s summary of nations launching cyber attacks at Canada, “we need to be careful with these kinds of lists,” he said. “While we certainly face challenges from those countries, they are not the only countries that we need to keep an eye on. We also need to understand that attacks in today’s age are not just limited to a simple Organization A in State A attacks Organization B in State B. They are much more complex than that.”
Another point that concerns McDougall is the fact that cyber attackers are constantly ‘stepping up’ their game. “What we do know is that the tactics, techniques, and practices used by our adversaries will evolve just as we evolve to meet those threats,” he told CDR. “What we can expect to see from our adversaries are new combinations of how to attempt to exploit technology, procedures, and people using tools that come at us from all angles. Those might include the traditional attempts through phishing emails to gain leverage over people in various ways. If the target appears worthwhile enough to them, they may even go so far as to create companies that look attractive to certain projects and attempt to insert them in supply chains through direct participation or partnerships.”
The good news is that Canadian defence-centric IT firms are keeping up with ever-evolving cyber threats. “Most in the defence space are used to risk management frameworks like those used by the Government of Canada, like ITSG-33,” said McDougall. As well, “We have seen organizations stepping up their game with respect to conducting due diligence and background checks as well as participating in various communities that work to identify, analyze, assess, and develop responses to threats. We are seeing an uptick in the use of more advanced forms of technology to help with different aspects of protection, detection, and response. When the new CPCSC [Canadian Program for Cyber Security Certification] efforts come on line, you’ll see the next surge of efforts within the private sector as we move to better protect the various resources.”
CCTX
The Canadian Cyber Threat Exchange (CCTX) provides actionable cyber threat intelligence with a Canada-centric focus to Canadian businesses. “Members improve their cyber posture leading to improved resilience and reduced financial, operational, and reputational risk by learning from each other, having access to a unique data feed and a trusted group to discuss challenges, and share experiences,” said Bob Gordon, CCTX’s Strategic Advisor.
According to Gordon, Canada and its allies are engaged in a never-ending cyber conflict. “DND and CAF benefit from the rapid and ongoing advances in technology such as AI and quantum computing,” he said. “Unfortunately, so do the adversaries.”
Echoing the words of MGen Yarker, Bob Gordon noted that “investment in technology is important in this environment. But equally important is investment in the human resources to design, build and operate the technology.” Unfortunately, “DND and CAF’s ability to operate in the cyber environment will be limited by the availability of a workforce with the skills required to address current and future cyber challenges,” he said. “Increased collaboration between CAF and the private sector may be one option for addressing the technical skills requirements.”
Also like MGen Yarker, Gordon believes that inter-linked Canada/US assets will keep these increasingly-estranged partners cooperating on cyber defence.“Canada and the US’ inter-connected critical infrastructures — e.g., energy grids, financial institutions, and telecommunication networks —- makes cyber security a shared strategic imperative,” he said. “A significant attack on any part of these networks risks a cascading effect throughout the network impacting both nations. Although we might want to consider de-linking some of these, the reality is that the two nations must work together for their mutual self interest. The same applies to joint military interests such as NORAD.”
Shared interests notwithstanding, Bob Gordon acknowledged that Canada’s estrangement from the US is creating political, economic, and social stresses affecting the people responsible for delivering military cyber security programs. “Recognizing the mutual interests of Canada and the US demands that mechanisms must be found to maintain, and where appropriate, expand existing relationships with our US counterparts,” he said. “In the current political climate, it will not be without its challenges. [But] Failure to rise to our collective defence interests is not an option.”
COOLIDGE SOLUTIONS
Coolidge Solutions is a Toronto-based cyber security firm dedicated to helping organizations navigate complex compliance frameworks, such as SOC 2, ISO 27001, NIST SP 800-171, CMMC, and Canada’s CPCSC.
Ade Ogunsowo is the company’s Co-Founder and CEO. Along with the onslaught
of cyber threats to Canada being sent by China, North Korea, and Russia “DND and CAF face ongoing threats from nation-state actors, misinformation campaigns, and supply chain vulnerabilities,” he said. “We’ve observed increased use of distributed denial-of-service (DDoS) attacks, particularly targeting public-facing digital services. We’ve also seen an exponential increase in disinformation tactics.”
The good news: “As these threats evolve, Canada’s national institutions, such as the Canadian Centre for Cyber Security, continue to offer robust public guidance and coordination,” Ogunsowo told CDR. “Nevertheless, resilience relies on extensive cooperation across sectors, including civilian defence suppliers. Industry and support agencies are enhancing cyber maturity, incident detection, and compliance alignment among organizations in the defence supply chain.”
Still, much needs to be done to boost Canada’s defence cyber readiness. “Public-private collaboration is growing, but it must be sustained and strategically focused to match the pace of evolving threats,” Ogunsowo said. As well, “Canada would benefit from a nationally enforced cyber security baseline across the defence and critical infrastructure sectors. Legislative efforts like Bill C-26 [from Parl.ca: ‘An Act respecting cyber security, amending the Telecommunications Act and making consequential amendments to other Acts’] should be expedited, and greater investment in cyber capabilities, particularly in personnel and infrastructure, is needed to meet long-term defence goals.”
Unlike Bob Gordon and Allan McDougall, Ade Ogunsowo does not believe that self-interest will be sufficient to bridge the rupture between Canada and the US. Instead, “We foresee an increased demand to deliberately ramp up efforts to strengthen our domestic cyber capabilities, reduce reliance on foreign systems, and ensure operational self-reliance in cyber defence and critical infrastructure protection,” he told CDR.
Included in the cyber gaps that Canada will now have to fill itself are emerging technologies like AI and autonomous systems, the need to harden civilian infrastructure, and “uplifting cyber readiness across small and mid-sized firms in the defence ecosystem,” predicted Ogunsowo. “Addressing these gaps will require mandatory security standards across sectors, increased federal support for capability-building, and continuous coordination between policy, operations, and compliance communities.”
LASTWALL
Lastwall is an identity security company that is trusted by the US Department of Defense’s Defense Innovation Unit (since 2017) and the Government of Canada.
James Grannan is Lastwall’s Vice President of Defense and Government Initiatives. He said the cyber threats outlined by MGen Yarker are becoming increasingly sophisticated. “We are observing increased usage of AI-driven cyber tools designed to automate the creation and conduct of sophisticated phishing campaigns, malware development, and deepfake images and videos,” he told CDR. “Additionally, the development of quantum computing capabilities intended to break current encryption methods represents a strategic blind spot — adversaries are collecting information now in great quantities, knowing that once they have a quantum computer with sufficient strength, they will be able to break the encrypted information they collected in the past.”
According to Grannan, this form of ‘Store-Now-Decrypt-Later’ cyber attack is already underway “and the government and industry as a whole are not doing enough to combat it,” he said. “This threatens everything from high stakes government operations and industrial secrets, to the security we take for granted, such as that which is built into every citizen’s banking cards. The security landscape is moving faster than the government can respond meaningfully, and it is most notably driven directly by adversarial state funding, and support.”
To help combat these threats in Canadian security, “Industry partners are playing a critical role in helping DND and the CAF address evolving cyber threats by delivering advanced Zero-Trust-based, ICAM solutions and strong multi-factor authentication (MFA) technologies,” said Grannan. “These systems offer resilient, future-ready protection against unauthorized access and credential compromise — including, in some cases, emerging quantum threats. Beyond technical solutions, industry continues to support the defence community through collaborative research, real-time threat intelligence sharing, and the development of interoperable capabilities that allow for faster adoption to the evolving threat landscape.”
This being said, James Grannan said the core challenge to Canadian cyber security is not the availability of effective technology, but rather the ability to procure and deploy it at the speed required. “To stay ahead of adversaries, Canada must modernize its procurement processes to match the pace of innovation,” he noted. “It can no longer afford to buy yesterday’s technology tomorrow.”
NOKIA
The quantum computing-based ‘Store-Now-Decrypt-Later’ attacks outlined by Lastwall’s Grannan are front-of-mind for Martin Charbonneau. He is Nokia’s Head of Quantum-Safe Networks in the company’s Network Infrastructure Business Group.
“A key emerging threat is the development of Cryptographically Relevant Quantum Computers (CRQCs), which could break widely used encryption and create zero-day vulnerabilities,” explained Charbonneau. “The ‘Harvest Now, Decrypt Later’ (HNDL) threat — where adversaries store encrypted data for future decryption using CRQCs — makes protection of sensitive data urgent. Consequences include data theft, system compromise, and identity spoofing.”
From an organizational risk management perspective, this evolving threat landscape underscores the need for proactive quantum risk mitigation strategies at the highest levels of corporate governance. Organizations must reframe quantum resilience not just as a technical upgrade, but as a critical component of enterprise risk management. This includes prioritizing quantum-safe audits of existing cryptographic assets, identifying high-value and long-lifetime data at risk, and investing in migration pathways to a Quantum-Safe digital future.
Making defence (and indeed all) networks ‘quantum-resilient’ is the goal of Nokia’s Quantum-Safe Networks (QSN) software. “QSNs use defence-in-depth security with quantum-resistant cryptography at multiple layers (optical, Ethernet, MPLS, IP),’ Charbonneau said. “Key technologies include Post-Quantum Cryptography (PQC), Pre-Shared Keys (PSK), and Quantum Key Distribution (QKD).”
Meanwhile, thanks to their ability to overwhelm data networks, “Distributed Denial of Service (DDoS) attacks are a primary weapon against national assets, demanding adaptive defences,” said Jeff Smith, VP/GM of Nokia Deepfield. “Attacks have surged in frequency and volume, with some exceeding 6.5 terabits per second (Tbps).” (A terabit is one trillion bits.)
Nokia has developed Deepfield Defender to counter DDoS threats. “Deepfield Defender provides real-time AI/ML-driven detection via the Deepfield Secure Genome, which tracks global DDoS activity and helps to establish ‘peacetime traffic models’,” Smith said. “It offers scalable, network-based mitigation through Nokia FP-series routers and the high-capacity 7750 DMS (up to 2.8 Tbps mitigation), enabling a ‘self-defending network’.”
The bottom line: “The transition to quantum-safe systems must begin now,” said Charbonneau. At the same time, network operators need to identify and address key technological and policy gaps in their IT infrastructure. “Technological gaps include legacy systems, encrypted traffic challenges, vulnerable IoT devices, and emerging AI-powered attacks,” said Smith. “Policy gaps involve insufficient CNI security mandates, fragmented information sharing, and slow adaptation to new threats.”
James Careless is CDR’s Ottawa Bureau Chief
