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What is Encryption? - Explanation & Meaning

Learn what encryption is, how data encryption protects information, and which methods like AES and RSA are used for secure communication and storage.

Encryption is the process of converting readable data into an unreadable format using an algorithm and a key. Only those who possess the correct decryption key can restore the original data, protecting sensitive information from unauthorized access.

What is What is Encryption? - Explanation & Meaning?

Encryption is the process of converting readable data into an unreadable format using an algorithm and a key. Only those who possess the correct decryption key can restore the original data, protecting sensitive information from unauthorized access.

How does What is Encryption? - Explanation & Meaning work technically?

There are two main types of encryption: symmetric and asymmetric. Symmetric encryption (such as AES-256) uses the same key for both encryption and decryption and is exceptionally fast, ideal for encrypting large volumes of data. Asymmetric encryption (such as RSA or ECC) uses a key pair: a public key to encrypt and a private key to decrypt. This forms the basis for digital certificates and TLS/SSL connections. Data-at-rest encryption protects stored data on disks and in databases, while data-in-transit encryption (TLS 1.3) secures data traveling across networks. End-to-end encryption (E2EE) guarantees that only the communicating parties can read messages, not even the service provider. Hashing algorithms like SHA-256 provide one-way encryption for securely storing passwords. Key management is crucial: keys must be securely generated, stored, and rotated via hardware security modules (HSM) or cloud-based key management services.

How does MG Software apply What is Encryption? - Explanation & Meaning in practice?

At MG Software, we implement encryption as standard in all applications. Database fields containing sensitive information are encrypted with AES-256. All communication runs over TLS 1.3. Passwords are hashed with bcrypt or Argon2. For API authentication, we use JWT tokens signed with asymmetric keys. We advise clients on the right encryption strategy for their specific compliance requirements, whether GDPR, PCI-DSS, or healthcare regulations.

What are some examples of What is Encryption? - Explanation & Meaning?

  • A messaging application implementing end-to-end encryption so messages are only readable by the sender and receiver, not even by the server provider.
  • A healthcare institution encrypting patient records with AES-256 at-rest and TLS 1.3 in-transit to comply with medical data security requirements.
  • An e-commerce platform encrypting credit card data in compliance with PCI-DSS and managing keys via a hardware security module for maximum protection.

Related terms

cybersecurityjwttwo factor authenticationdata privacyzero trust

Further reading

Knowledge BaseWhat is Data Privacy? - Explanation & MeaningWhat is Cybersecurity? - Explanation & MeaningBest Encryption Tools 2026Software Development in Amsterdam

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Frequently asked questions

Symmetric encryption uses one shared key for both encrypting and decrypting. It is fast but requires a secure way to share the key. Asymmetric encryption uses two keys: a public key to encrypt and a private key to decrypt. It is slower but solves the key exchange problem. In practice, both are combined: asymmetric encryption for key exchange, symmetric for the actual data encryption.
End-to-end encryption provides a very high level of security because data is only readable at the endpoints. The weakest links are the end devices themselves: if a phone or computer is compromised, data can still be read. That is why it is important to take endpoint security seriously alongside E2E encryption.
Modern encryption algorithms like AES-256 are optimized for hardware acceleration and have minimal impact on performance. TLS 1.3 has simplified the handshake to a single roundtrip. For most applications, the performance overhead is negligible. At extremely high volumes, encryption can be accelerated via dedicated hardware.

What is the difference between symmetric and asymmetric encryption?

Symmetric encryption uses one shared key for both encrypting and decrypting. It is fast but requires a secure way to share the key. Asymmetric encryption uses two keys: a public key to encrypt and a private key to decrypt. It is slower but solves the key exchange problem. In practice, both are combined: asymmetric encryption for key exchange, symmetric for the actual data encryption.

Is end-to-end encryption secure enough?

End-to-end encryption provides a very high level of security because data is only readable at the endpoints. The weakest links are the end devices themselves: if a phone or computer is compromised, data can still be read. That is why it is important to take endpoint security seriously alongside E2E encryption.

What does encryption mean for my application performance?

Modern encryption algorithms like AES-256 are optimized for hardware acceleration and have minimal impact on performance. TLS 1.3 has simplified the handshake to a single roundtrip. For most applications, the performance overhead is negligible. At extremely high volumes, encryption can be accelerated via dedicated hardware.

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