Difference Between Tokenization and Encryption

In the era of computing and technology, the security of the system has become a major part of our lives. Many scams are happening online and they are known as cybercrimes.

To avoid them or to lower the chances of risk the techniques used are tokenization and encryption. The two of them are generally used together but they have differences. 

Tokenization vs Encryption

The main difference between tokenization and encryption is that they both are different in the ways they work. Tokenization is a technique in which the data is transformed into enclosed data randomly into tokens that are stored in a database whereas in encryption the data is converted into unreadable text by the use of mathematical algorithms and keys. 

Tokenization vs Encryption

Tokenization is a way of keeping the data safe by converting the plain text into random values which are unreadable and can be accessed with the help of tokens that are stored in a database.

Structured data like cards, online payments are easy to maintain with the help of this. 

Encryption is another method of converting the data in such a way that it is not accessible to the naked eye.

This method involves the data to be converted and secured by the use of mathematics as well as structured algorithms. The main advantage of using this is it can handle large data from a database. 

Comparison Table Between Tokenization and Encryption

Parameters of ComparisonTokenizationEncryption
DefinitionTokenization is the process of converting data into unreadable data by the use of random tokens that are stored in the database Encryption is a way of converting the data by the use of mathematical algorithms and coding to make it inaccessible to a normal human. 
Handling sizeTokenization can only handle small data because the ma implementation is very difficultEncryption can handle large databases because it has set rules that have to be followed
Usage Tokenization is used in structured data like cards, online payments that are easy and hassle-free. Encryption can be used for both types, that is, structured data fields as well as an unstructured complete file. 
AdvantageThe original data in tokenization is never lost that is useful in some cases as well as the format can be maintained without the worries of securityEncryption is ideal when the data has to be decoded since the key is only required by third parties. 
DisadvantageThe process in tokenization of decoding is quite slow because it can only be done when the token is available. The original data is sent in the form of encryption and leaves the organization and format-preserving is difficult. 

What is Tokenization? 

The world has grown over the internet and the need for protecting the information and data of the people as well as the companies is growing each day.

Tokenization is a method to convert the data from a database to random encryption.

The encryption has a token attached that is stored in a database and for accessing the information the third party should have the tokens. 

The tokens are used in a data structure that is more arranged and easy to access. Since it takes a long amount of time for a large amount of data because the tokens are made slowly.

This is used for payment gateways, storing card details on the internet, etc. In this process, the data is sent to a company where they decrypt and perform the necessary actions. 

The advantage of using this type of encoding is that they retrieve the information that is stored and sent to the third party as it is accessed by a token and also makes sure that the format is maintained and secured since cracking it is not easy due to not having a set algorithm. 

The technique of tokenization is quite popular and gained more popularity due to the extra security it gives to the people for the storing of data.

The process is slow is not preferred by big companies but for storing sensitive information it is used. 

What is Encryption? 

Due to the process of tokenization being slow the developers had to go for something fast and had a similarity in all the data stored by a company and that led to the development of the encryption technique.

Encryption is the process of converting the data into encoded texts that can only be accessed by the use of a key that is provided to the third party.

The process of encryption includes converting the data by the use of mathematics and algorithms designed especially for this process.

The algorithms include specific information on how each piece of value will be treated by the system. 

The advantage of using this process is that they are fast since it is a designed algorithm that helps in the whole process.

Along with this, it can also be used with data structures that are not arranged or unstructured so they are used at various companies.

Sometimes the data is to be only accessed by the third party and the original users don’t need the information after that. 

The disadvantage of using encryption is that they are not helpful when we want to retrieve the data as the original party since it is already in the hands of a third party.

There are sets of rules that sometimes make it easy for the cheaters to access this and cause malfunctions. The format has to be changed periodically because of the factor of predictability. 

Main Differences Between Tokenization and Encryption

  1. Tokenization is the process of converting data into unreadable text by the use of random tokens that are stored in the database whereas encryption is a way of converting the data by the use of mathematical algorithms and coding to make it inaccessible to a normal human. 
  2. Tokenization can only handle small data because manual implementation is very difficult whereas encryption can handle large databases. After all, it has set rules that have to be followed. 
  3. Tokenization is used in structured data like cards, online payments that are easy and hassle-free. In comparison to this, encryption can be used for both types, that is, structured data fields as well as unstructured complete files. 
  4. The original data in tokenization is never lost, which is useful in some cases as well as the format can be maintained without the worries of security whereas the advantage of encryption is ideal when the data has to be decoded since the key is only required by the third parties. 
  5. The process in tokenization of decoding is quite slow because it can only be done when the token is available whereas in encryption the original data is sent in the form of encryption and leaves the organization and format-preserving is difficult. 

Conclusion

The two techniques that are tokenization and encryption are very helpful and have been a means to protect our data from hackers. The people are learning the techniques for the benefit of themselves and their system.

Tokenization uses random ways of encoding the data whereas encryption uses a set number of rules to make it more systematic.

In tokenization, the third party only requires a token and the original data can be retrieved whereas in encryption it can convert a large amount of data at a time.

Tokenization gives extra security because the format can be easily conserved. 

References 

  1. https://www.sciencedirect.com/science/article/pii/S1363412711000161
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