Virtual Data Room Blog

Data Encryption - A Dataroom's Perspective

Feb 22, 2013 6:23:00 PM / by Sara Salehian


VDRWhy is encryption important for a dataroom? What is encryption?Anytime information is transferred over the internet, encryption is an important consideration. It is essential that you understand how encryption works, the different methods of protecting data, and how it can be used in a virtual data room.

What is encryption? This is the process of encoding information to prevent unauthorized access by hackers, while still allowing access to permitted users. An algorithm transforms the data into ciphertext using an encryption key.Providers should understand the basics about encryption in order to understand the options available to them in transferring data safely. There are various levels of protection available and they need to recognize the difference to provide the best security to their customers.  

Encrypting Traffic

As data passes through the internet to the intended destination, it must be encrypted to prevent unauthorized access. This is equally true whether it is sent to an email or to a virtual data room. An encryption key can be either 128 bit or 256 bit. While the 256 bit is double the 128 bit, it is actually many times stronger than that. It actually has 1.5 x 2e256 combinations, which makes it almost impossible for a hacker to break the code and gain access.

This encryption is easily seen on secure sites such as online banking or ecommerce sites where private information is entered. The site will use Secure Sockets Layer (SSL) protection to prevent access to that data. It is either in 128 or 256 bits and one code is used to encrypt it and another one is used for decryption. Decryption is when the data is restored back to its original form to allow the receiving person to be able to read it.

Encrypting Files

When files are sent to a virtual data room, they must be encrypted to protect their confidentiality. Only users with the appropriate id and password will be allowed access to these files. The VDRs use encryption with 256 bit protection. They also utilize other resources to protect the information such as File Open. It is a free resource compatible with every version of Adobe Reader from version 4 up and is popular with many companies all over the world. It is a method of encrypting the files and authenticating the user for decryption.

File Open allows you to access certain files for a limited time and print them for your use. You must register and download the tool and you can only view from the computer you downloaded the document to in the first place. This protects the document from being accessible for an unlimited time or from availability on numerous devices.

Remote Lock Down is a method of protecting information if it is stolen or ends up in the wrong hands. With this tool, you can prevent anyone from reading the information even if they gain access to the file. It is encrypted even if the person has a login account. Once the information is safe again, the process is reversible.

Advanced Encryption Standard or AES encryption is the algorithm used by all non-government agencies as the standard for protection of data. It is deemed to be even more secure than other types of encryption, including DES and Triple DES. It is the encryption that you will find in most virtual data rooms.

When selecting a virtual data room for your business, it is essential that you feel confident in the security of your information. You must be certain that the files are protected by encryption and that tools are used to prevent unauthorized access to protect yourself and your clients.

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Topics: Data Room, virtual data room, VDR, Data Security, security