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What Is Encryption?
Encryption is a means of securing digital data using an algorithm and a password—also called a key. The encryption process translates information using an algorithm that makes the original information unreadable; the process converts the original text, known as plaintext, into an alternative form known as ciphertext. When an authorized user needs to read the data, they may decrypt the data using a binary key. This will convert ciphertext back to plaintext so that the authorized user can access the original information.

Encryption is an important way for individuals and companies to protect sensitive information from hacking. For example, websites that transmit credit card and bank account numbers should always encrypt this information to prevent identity theft and fraud.

KEY TAKEAWAYS
  • Encryption is a means of securing digital data using an algorithm and a password—also called a key.
  • The encryption process translates information using an algorithm that makes the original information unreadable except for authorized users.
  • Encryption is an important way for individuals and companies to protect sensitive information from hacking.

How Encryption Works
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Example of Encryption
In May 2018, the Wall Street Journal reported that, despite the importance and accessibility of encryption, many corporations still fail to encrypt sensitive data. By some estimates, companies encrypted only one-third of all sensitive corporate data in 2016—leaving the remaining two thirds sensitive to theft or fraud.
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