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This paper argues that the primary threat posed by cyber-attacks is not cataclysmic physical destruction - but rather more insidious societal risks such as reduced trust in government. To test this claim, we collect and analyze survey data in the immediate aftermath of a ransomware attack against a Düsseldorf hospital (n = 707). We find that exposure to cyber-attacks significantly diminishes public confidence among segments of the population who are exposed to the attack. Cyber-attacks exploit particular qualities of cyberspace that are directly tied to matters of public confidence, causing a precipitous drop in public trust. Second, we identify the psychological mechanism underpinning this effect, with anger and dread intervening in countervailing directions. Feelings of anger triggered by exposure to cyber-attacks amplify public confidence, while the more potent feeling of dread reduces confidence. Our findings verify that governments cannot rely on a unifying social-cohesion effect following cyber-attacks since the public is liable to perceive the authorities as incapable of defending against future threats. We conclude by discussing why escalating cyber-threats can cause severe social upheaval and reduce trust in democratic institutions, and discuss what constitutes exposure to the new generation of attacks in cyberspace.