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Data Encryption: What It Is, Why It’s Important, and Best Practices

Data encryption transforms information into unreadable formats, protecting it from unauthorized access and securing sensitive data across devices and servers.

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Every piece of sensitive data your organisation handles is a potential target. Without the right safeguards in place, even a minor breach can lead to compliance issues and reputational damage. Ensuring sensitive data is protected is a critical step in any data strategy — and how you do it matters. That’s where data encryption can help. Data encryption transforms information into unreadable formats, protecting it from unauthorised access and securing sensitive data across devices and servers.

Encryption plays a key role in data privacy since it secures data stored on physical drives and protects data transmitted across networks. It is a cornerstone of data security platforms, helping ensure compliance with industry standards and regulatory requirements.

Let’s dive deeper into encryption standards, types, and best practices to help fortify your data security and protect valuable information.

What is end-to-end encrypted data?

End-to-end encryption (E2EE) is a way to protect data all the way from its origin to its destination. With E2EE, only the sender and receiver can access the data—even the service providers handling the transmission can’t see it. This type of encryption is popular in data security software, especially for apps like secure messaging and email services, where privacy is essential.

E2EE works by encrypting data on the sender's device before it's sent and only decrypting it when it reaches the receiver's device. This way, even if the data is intercepted along the way, it remains unreadable.

Data at rest vs data in transit encryption

Data encryption can protect information in two main states: at rest and in transit. Data at rest refers to information stored on devices, databases, or cloud storage. Encrypting data at rest means that even if someone accesses the storage, they won’t be able to read the information without the decryption key.

Data in transit, on the other hand, is information actively moving from one place to another, like when an email is sent or files are uploaded. Encryption for data in motion secures it while it's traveling over networks, so it can’t be read if intercepted. It’s important to protect data in both states since each represents a different potential vulnerability.

Data masking vs data encryption

Data masking and encryption are both techniques to protect sensitive information, but they work in different ways. Data masking tools replace real data with fictional but realistic information, often used for testing or development purposes. For instance, a masked database might replace real customer names and account numbers with fake ones, allowing developers to work with the data without exposing real details. Salesforce’s Data Mask & Seed accelerate development while minimising security risks by providing production-like data to test Sandboxes.

Encryption, on the other hand, scrambles data so it can only be read by someone with the decryption key. Unlike masked data, encrypted data can be reverted to its original form when needed. Data masking is ideal for environments where you don’t need to restore the original data, while encryption is best for situations where authorised users may need to access the actual information securely.

Why is data encryption important?

By converting data into a coded format, encryption ensures that only authorised parties can access or interpret it. This is especially important in industries like finance and healthcare, where sensitive data must remain protected from unauthorised access and cyber threats.

Benefits of data encryption
  • Confidentiality: Encryption protects private information, so it stays confidential even if it falls into the wrong hands.
  • Integrity: By ensuring that data isn't altered during storage or transmission, encryption helps maintain the reliability of the information.
  • Authentication: Encryption can verify the identity of users and systems involved in data exchanges, enhancing trust.
  • Compliance: Many regulations, such as GDPR and PCI DSS, require encryption to protect personal and financial data, making it essential for meeting compliance standards.
Impact of encryption on data breaches

Encryption is an effective way to mitigate the impact of data breaches. Even if the data is compromised, it remains unreadable, which reduces the risk of attackers misusing the information they intercept.

For example, financial institutions frequently use encryption to protect sensitive information such as account numbers and transaction details. In cases where encrypted data was stolen, the attackers were unable to access or misuse it, significantly reducing the impact on customers.

Types of data encryption

Data encryption methods vary based on security needs and use cases. Here’s a breakdown of the most common types of encryption and where they excel:

  • Symmetric Encryption: This method uses a single key for both encrypting and decrypting data, making it fast and efficient. Symmetric encryption, such as AES, is ideal for secure internal environments where the same parties handle both processes.
  • Asymmetric Encryption: Also known as public-key encryption, this method involves a public key for encrypting and a private key for decrypting data, allowing secure exchanges without a shared key. Asymmetric encryption, like RSA, is commonly used for secure online transactions and emails.
  • Hybrid Encryption: Combining both methods, hybrid encryption uses asymmetric encryption to exchange a symmetric key securely, then uses it for fast data encryption. This approach is the foundation for secure internet connections, such as HTTPS.
  • Quantum Encryption: Although still in development, quantum encryption aims to protect against future threats from quantum computing. By using quantum mechanics, it could one day provide a highly secure alternative to current methods.

How does data encryption work?

Encrypting data effectively is essential for maintaining its security, whether it’s stored or actively in use. Data encryption transforms plaintext into ciphertext using algorithms and encryption keys. It typically involves three steps:

  1. An encryption key is generated, which will lock and unlock the data.
  2. The encryption algorithm, like AES or RSA, uses the key to convert plaintext into ciphertext.
  3. When authorised users need access, they use the decryption key to revert ciphertext back to readable plaintext.

Encryption algorithms rely on key complexity, so longer keys offer stronger security against attacks. Proper key management, which includes keeping keys secure and rotating them regularly, is critical to maintaining the strength of encryption.

Encrypting data at rest

Encrypting data at rest protects it no matter how it’s stored. Some common methods include:

Cloud Storage Encryption: Major cloud providers offer data-at-rest encryption for stored data, adding an essential layer of cloud data security.

Full Disk Encryption (FDE): Encrypts everything on a storage device, protecting data if the device is lost or stolen.

Database Encryption: Many databases use transparent data encryption to secure information within the database itself, making it unreadable without proper access credentials.

Encrypting data in transit

Data in transit is at risk as it moves between locations, such as across networks or between servers. You can secure it with:

  • TLS/SSL Protocols: TLS (Transport Layer Security) and SSL (Secure Sockets Layer) are commonly used to secure data during online transactions, preventing eavesdropping or interception.
  • VPNs: Virtual private networks (VPNs) create secure, encrypted connections over public networks, which is ideal for remote work and secure internet browsing.
Encrypting data in use

Data in use refers to information actively processed by applications, where it’s temporarily decrypted for use. Protecting data in this state is complex, but new technologies are emerging, including homomorphic encryption. This advanced encryption allows data to be processed without decrypting it, preserving privacy even while data is in use. Although still developing, homomorphic encryption has promising applications in fields like secure data analytics and cloud computing.

Common data encryption challenges

While encryption is a powerful tool, it’s not without its challenges. Security threats and implementation complexities can undermine encryption’s effectiveness if not carefully managed. Here are some common challenges and how to address them:

  • Brute-force attacks: Repeated attempts to guess encryption keys make shorter keys vulnerable. Using long, complex keys like AES-256 offers stronger protection against these attacks.
  • Side-channel attacks: Information leaks during encryption processing (e.g., timing data) can expose keys. Implementing secure algorithms and specialized hardware reduces the risk of these vulnerabilities.
  • Quantum computing: Future quantum capabilities could break today’s encryption methods. Research into quantum-resistant algorithms is ongoing, helping organisations prepare for long-term data and cloud security.
  • Key management: Managing encryption keys across systems can be complex. Centralized, automated key management systems simplify this process and enhance overall security.

Data encryption best practices

To maximise the security benefits of data encryption, organisations should implement a few essential best practices. These strategies help ensure encryption is both effective and up-to-date.

Implement strong encryption standards

Choosing the strongest encryption standards is foundational for data security. Algorithms like AES offer high levels of security, especially with key lengths of 128-bits or more. Regularly assess and update encryption algorithms to stay ahead of emerging threats.

Practice regular key rotation and management

Encryption keys are only as secure as their management. Regularly rotating keys and using strong storage and password policies helps prevent unauthorised access. Automated tools simplify key rotation and centralise management, reducing risks and minimising potential damage from compromised keys.

Integrate encryption with other security measures

Encryption works best as part of a broader security strategy that includes authentication, access control, and data integrity measures. A multi-layered approach creates a more resilient security framework, minimising the likelihood of breaches. For example, pairing encryption with multi-factor authentication strengthens data security since only verified users can decrypt sensitive data.

Ensure compliance with regulatory requirements

Many industries are required to meet specific encryption standards for regulatory compliance. For example, healthcare organisations must follow HIPAA guidelines, while financial institutions often adhere to PCI DSS standards. Meeting these requirements supports data security compliance and helps avoid penalties.

How to choose the best data security and encryption tools

Selecting encryption software that meets your organisation’s security needs is key to safeguarding data. Focus on solutions that align with recognised security standards, integrate smoothly with existing systems, and offer user-friendly management. Here are some essential features to look for:

  • Compliance with industry regulations
  • Automated key management for secure, centralised control
  • Seamless integration with databases and cloud systems
  • The ability to grow alongside your data needs

Choosing software with these capabilities ensures a balance of strong protection and ease of use, which means long-term support for your organisation’s data security. Salesforce offers tools to do just that. Learn how Shield Platform Encryption can help you secure your sensitive Salesforce data while managing your own encryption keys.

Data Encryption FAQ

Data encryption is the process of converting data into a code to prevent unauthorised access. It uses cryptographic keys to transform data into an unreadable format, making it secure and inaccessible to anyone without the correct key.

Data encryption works by using an algorithm and a key to scramble data. The key is a string of characters used to encrypt and decrypt the information. The data remains encrypted until a user with the correct key unlocks and decodes it, restoring the data to its original, readable form.

Data encryption is crucial for businesses as it protects sensitive information from cyber threats and data breaches. It helps ensure compliance with data protection regulations, builds customer trust, and safeguards intellectual property, financial records, and personal data.

There are two primary types: symmetric and asymmetric encryption. Symmetric encryption uses a single key for both encryption and decryption. Asymmetric encryption, also known as public-key cryptography, uses a pair of keys: a public key for encryption and a private key for decryption.

Businesses should choose tools based on their specific needs, regulatory requirements, and existing infrastructure. Key considerations include the type of data being protected, the ease of implementation, integration capabilities, and the vendor's reputation for security and support.

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