HSM for your data’s sake – How cryptographic encryption protects company assets

Organizations aware of the threats posed by the digital space are seeking ways to secure their data. An increasing number of companies are opting for cryptographic solutions. HSM (Hardware Security Module) is becoming an increasingly popular method of data protection for several reasons.

What is an HSM?

An HSM is a hardware security module designed to protect the most critical data of servers and applications. It enables the generation and storage of cryptographic keys in a protected, isolated environment, which consequently allows for cryptographic encryption. It includes integration software that supports industry standards (e.g., PKCS#11, Microsoft CSP/CNG, JCE, OpenSSL). As a result, these devices are characterized by:

• the highest level of security – providing reliable physical and logical protection of cryptographic material,

• top-tier performance,

• simplicity of implementation – in both new and existing infrastructures.

Which hardware platforms can be “armed” with an HSM?

Thanks to a modular system design, these devices work across all hardware platforms—from PCIe cards to dedicated standalone appliances. There are several options when choosing the right device:

• PCIe devices are intended for use in autonomous servers and appliances within existing IT infrastructure without the need for modification. They offer the best price-to-performance ratio and ensure lower server resource consumption. They allow for remote administration and, in addition to secure key management, can detect physical tampering.

• Network (LAN) HSMs are used where physical separation of the encryption module from the rest of the hardware infrastructure is recommended. These devices are fully scalable, offering clustering capabilities and parallel access from multiple devices on the network. They also feature extensive remote configuration and tampering detection.

Hardware Security Modules and cryptographic encryption are used wherever there is a need to:

• Enhance digital information security: Functions include asset protection, dual control, first-contact security, and database encryption.

• Streamline processes: Features such as key consistency verification, rapid deployment time, and data encryption/decryption using cryptographic keys are extremely useful here.

• Manage cryptographic operations: HSMs allow for the creation of permission structures, public/private key generation (according to the algorithm), integration with applications via standardized interfaces, digital certificate generation, and issuing/accepting key data requests. They can store hundreds of keys.

When is it worth using cryptography?

An HSM is not a necessary solution for every organization. The choice of a hardware security module for cryptographic encryption should be dictated by the volume and sensitivity of the data that requires restricted access.

Information asset analysis is one of the pillars of cybersecurity. If an organization possesses a large amount of sensitive or mission-critical data, access to it must be limited.

This applies not only to external access; internal restrictions on key data should also be implemented. Hardware safeguards are significantly more resistant to breaches than system-level restrictions, although the latter certainly help address the issue of universal information availability.

HSMs are frequently used to store cryptographic material (keys) used for encrypting digital data in business processes and transactions, such as:

• securing electronic documents in government offices and institutions,

• managing access keys and security within data exchange frameworks,

• securely generating keys for encrypting online transactions.

• storing these keys in a manner that prevents copying or moving them,

• enabling control over confidential cryptographic data.

HSM performance and scalability

An HSM is a high-performance solution that ensures efficient operation and the ability to scale infrastructure, allowing organizations to handle large volumes of data and cryptographic transactions. This is particularly important for securing payment data in e-commerce.

An increasing number of standards mandate data protection, such as PCI DSS, HIPAA, or GDPR. Encrypting data with an HSM helps organizations meet these requirements. The solutions we offer at Perceptus guarantee the highest level of protection for sensitive data in a shielded, isolated environment. This is evidenced by certifications such as FIPS 140-2 Level 3 and Level 4 (USA) and the European eIDAS Common Criteria EAL4+ certificate.

How exactly does cryptographic encryption work with an HSM?

Encyption using an HSM is based on the following actions: 

Generating cryptographic keys

The HSM generates high-entropy keys, making them difficult for a potential attacker to guess. These keys are stored inside the HSM and are only accessible to authorized users with appropriate permissions stored on a dedicated smart card.

Storing cyptographic keys

Access to keys is strictly controlled and requires authorization, often using one- or two-factor authentication.

Data encryption

To encrypt data, a user or application sends a request to the HSM to use the appropriate cryptographic key.

The HSM performs the encryption operation using the key stored inside the device. 

Data decryption

To read encrypted data, the user or application must likewise request the HSM to use the appropriate key for decryption.

Access control

The HSM ensures control over keys and encryption/decryption operations. Only authorized entities can perform these tasks.

Access monitoring

The HSM natively logs operations related to keys and cryptography, enabling the identification of unauthorized access attempts, attacks, or excessive usage.

Do you want to implement an HSM in your infrastructure? Let’s talk!