Encryption is the process of converting clear information into the code to prevent unauthorized access to it. Governments, companies, and individuals use encryption methods to protect their personal data and prevent fraud. Recent studies show that about 50% of data and communications on the Internet are already encrypted over HTTPS.
How does data encryption work?
Encryption involves the conversion of simple data into illegible data. In the encryption process of the basic text, the plaintext (data that can be clearly understood) is subjected to an encryption process that turns it into an encrypted text (which is not readable). In this way, it is possible to guarantee that the information sent can only be read by a person with a specific decryption key. When this key is used to decrypt data, the information is converted back to its original state.
Contrary to popular belief, most cryptocurrencies and their blockchain networks do not use encryption methods. Instead, they are based on hash functions and digital signatures. For example, the Bitcoin protocol uses cryptographic tests to protect the network and guarantee the reliability of every transaction. Digital signatures ensure that every user can only spend funds from their portfolio and that these funds cannot be spent more than once.
However, cryptocurrency websites can use encryption to ensure the security of their customers. Cryptocurrency wallets also use encryption to protect wallet files and passwords.
What are the benefits of encryption?
Encryption is useful for protecting sensitive information such as names, addresses, phone numbers, private messages, and social security numbers. If hackers break into the computer network and gain access to the system, they will not be able to decrypt this data without a decryption key.
Encryption also guarantees the confidentiality of companies and individuals. They can exchange encrypted information on the Internet and prevent surveillance by government agencies. Many of the largest global companies currently use this technology to ensure the security of customer information. In the event of hacking, these hackers will not be able to access confidential customer data, such as a credit card number or a personal address.
Organizations can also use Encryption to improve their compliance procedures. For example, medical companies in the United States must encrypt patient data to meet HIPAA data quality standards. The federal government can penalize companies that are unable to adequately protect patient data.
Encryption prevents hackers from accessing data, improves regulatory compliance, reduces the likelihood of fraud and makes it safer to send money online when using cryptocurrencies. More and more organizations and individuals use this technique to protect their confidential data.