Information Technology

The Ultimate Guide to Tokenization and Encryption Processes

What is Tokenization and How Does it Work?

Tokenization is a process which replaces sensitive data with an encrypted token. The token is then stored in the database instead of the original data. A token has no information about the original data, and it can be used to identify and replace the original data with just one query.

Tokenization provides a way to protect personally identifiable information (PII) from being exposed or stolen in the event that a database is breached. Tokenized systems are designed to prevent attackers from gaining access to sensitive PII by preventing them from identifying which records contain PII and then altering those records without detection.

What is Encryption and How does it Work?

Encryption is the process of converting data into a form that can only be read by those who have the correct key or password.

Encryption is done through a process called “scrambling” which converts the original message into an unreadable form.

The most common form of encryption is called symmetric encryption, and it uses a single key to encrypt and decrypt data. The same key is used for both processes, so it must be kept secret from anyone who does not need to know it.

What is the Difference Between Encryption & Tokenization?

Encryption is the process of encoding a message or information in such a way that only authorized parties can read it.

Tokenization is the process of converting personal data into tokens or code values.

Encryption: Encrypting data means that it is encoded using an algorithm so that it can’t be read by anyone without the key to decrypt it.

Tokenization: Tokenizing data means converting personal information into tokens or code values so that there’s no need for sensitive data to be stored in its original form.

How to Use Encryption and tokenization for Data Protection

Encryption and tokenization are two of the most important tools that we have in our data protection arsenal.

Encryption software is a way to protect your data from unauthorized access. It converts the data into an encrypted form, making it unreadable for anyone who does not have the key to decrypt it.

Tokenization is a process by which a company replaces sensitive customer information with unique tokens that can be used in its place. This means that if someone were to get their hands on these tokens, they would not be able to identify any of the customer’s personal information unless they had access to the tokenization system itself.

How to Implement Tokenization and encryption in Your Business to Protect Your Company’s Data?

The purpose of tokenization and encryption is to protect the data that is stored on a company’s server. The data in this case can be anything from credit card information to medical records. In order for a hacker to steal the data, they would have to first break through the encryption or tokenization, then find out which server it was on, and finally break into that server.

Encryption: Encrypting data means that it is encoded with a key, then decoded with a key. This makes it nearly impossible for an unauthorized person to read or modify the data without knowing how it was encrypted in the first place.

Tokenization: Tokenizing data means that sensitive information is replaced by tokens (random numbers) before being stored on a computer system. When this information needs to be accessed, it is decrypted and the original data can be read. Variant: Variants are a type of subtype that can be selected to better match your data. For example, with a user ID of 123456, you could use variants like 1, 2 or 3.

What should your business use: Tokenization or Encryption?

Tokenization is a process of converting personal information into a group of words or numbers. This process is irreversible and the tokens are not connected to the original data.

Encryption, on the other hand, is a reversible process that converts data into an unintelligible format. The original data can be decrypted with the help of an encryption key.

The decision to use tokenization or encryption should depend on what kind of company you have and what type of information you store. If your business deals with sensitive customer data then tokenization would be more suitable for you as it does not risk exposing any personal information in case there is a breach in security. If your business deals primarily with non-sensitive customer data then encryption would be sufficient for your needs as it protects this type of information without any performance impact.

If your business deals with sensitive customer data you should use a hybrid solution that includes encryption, such as Microsoft BitLocker or Microsoft Azure Information Protection.

Encryption vs. tokenization: Making the choice?

The two approaches are used for different purposes and have different security profiles. Encryption is designed to protect against eavesdroppers, while tokenization protects against unauthorized access.

Encryption is used to protect against eavesdroppers, while tokenization is used to protect against unauthorized access.

An encryption approach protects the confidentiality of transmitted data, while a tokenization approach protects the integrity of transmitted data.

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I'm a self-taught hacker, I do a little bit of everything: hacking (security), cryptography, Linux system administration, networking/routing and virtualization/hardware/software development. I'm a freelance IT Support Advisor, providing IT support to small and medium-sized enterprises (SMEs).
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