What is Tokenization and How Does it Work?

October 1, 2022

On average, it costs a business $4.24 million if they have a data breach. Most companies can’t afford to spend $4.24 million. Entrepreneurs and business leaders don’t have time to mess around with online security.
Firewalls, employee training, and anti-virus programs all help security, but businesses can take it a step further with tokenization.

Tokenization is confusing at the surface, yet this growing market is expected to be worth $5.6 billion soon! There’s good reason.

Tokenization greatly reduces the risk of theft, be it identity, data, or financial. It can be an incredible resource for any company, regardless of size.

Business leaders don’t need to know all of the ins and outs of tokenization. That’s for your IT team or provider to understand. It is important though, to have a general understanding of what tokenization is and how it works.

Take a look at this infographic to learn more about tokenization. Here we break down the topic into small manageable pieces. In simple terms, tokenization is the process of taking sensitive data, and transforming it into randomized non-sensitive data. This non-sensitive data is called “tokens”. It’s the tokens that are saved and transferred from individual to individual within the organization. Meanwhile, the sensitive data is securely kept away from the organization’s systems.

Even if a hacker got in, they’d really only be able to access the tokenized data. The real data would still be hidden away. Best of all, tokenized data can’t be read or used anywhere, making it worthless to hackers!

What is Tokenization and How Does it Work

Infographic Source: https://acumenconnections.com/what-is-tokenization-it-expert-explains/

A dedicated full-time digital marketer with 12+ years of experience in the industry. Since 2015, he has been successfully running infographicportal.com, a platform that showcases high-quality infographics across various topics. Nagendra's expertise lies in creating and executing effective digital marketing strategies that drive engagement and growth. His passion for visual storytelling and commitment to excellence has made him a respected figure in the digital marketing community.

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