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What is Hardware Security Module (HSM) and why is it important?

What is Hardware Security Module (HSM) and why is it important?

What is HSM (Hardware Security Module)?

In a digital world, organizations rely on digital keys to automate their processes while keeping operations secure. This is where the Hardware Security Module (HSM) becomes useful. HSMs are widely used in managing and safeguarding cryptographic keys, ensuring the effectiveness of lifecycle management.

Hardware security module

A hardware security module is a dedicated cryptographic processor, designed to manage and protect digital keys. HSMs are tamper-resistant physical devices that perform various operations surrounding cryptography: encryption, decryption, authentication, and key exchange facilitation, among others. These devices are trusted – free of any potential breach from malware, viruses, and unauthorized access.

Being a physical device, the hardware security module has a strong operating system paired with a restricted network access – making it the “Root of Trust” in an organization’s security infrastructure.

Purpose of hardware security module

Given the sensitivity of data organizations handle, they are required to keep their security operations top-notch. Businesses mostly use HSMs to hide their digital keys and certificates. Hardware security modules protect data, identities, and transactions within the network by strengthening encryption processes. They onboard secure cryptographic key generation, storage, and management.

As HSMs are considered the Root of Trust, cryptographic security is dependent on its ability to generate and protect keys within the secured environment. This makes the hardware security module a crucial part of the organization’s network infrastructure.

How hardware security module works

Encryption is the core of today’s security standards. For data to be encrypted, cryptographic keys have to be generated. A risk, however, is for the key to be exposed to possible breaches. This is where HSM comes in. HSM can be used to generate these digital keys, and the special hardware it has to create entropy and allow the generation of high-quality keys without the possibility of users or applications accessing the specific key.

In a network, for instance, a user requests a cryptographic operation such as issuing a digital signature. The hardware security module issues the digital signature using a private key in its secure environment and provides the resulting output back to the user. The key cannot be exported or extracted by the user because the functions are confined within the HSM’s isolated environment.

Advantages and disadvantages of hardware security module

With the increasing capabilities of servers to generate unique keys, organizations often wonder about the benefit HSM could bring to their process. In one short answer, the major advantage of the HSM is providing a more secured storage than a server.

First, the hardware security module gives physical access protection as they are kept outside the organization’s network. Cyber criminals need to physically access the HSM to view protected data. In addition, HSM has protective mechanisms such as voltage sensors, drill protection foil, and temperature sensors that safeguard data from external attacks. Any unauthorized physical access would immediately trigger an alarm to initiate countermeasures like destroying data in the event of a breach.

With the entropy created by the HSM, the strongest cryptographic keys are generated. HSMs have built-in random number generators that produce truly unique values, unlike conventional software that relies on commands. The hardware security module can register data from random physical processes that are unpredictable for attackers.

Other benefits of HSM include:
  • Protecting cryptographic data throughout its lifecycle
  • Preventing key exposure in unsafe environments
  • Aid in load balancing as it can take on tasks of servers
  • Ensure cybersecurity compliance by meeting industry standards.

Despite the many advantages, HSMs also have disadvantages. These include costly updates given its hardware nature.

Hardware security module vulnerabilities

Considering the costly updates of HSMs, vulnerabilities are present. Organizations have to regularly boost their cybersecurity systems with emerging trends. If a weakness is exposed in HSM’s cryptographic algorithm, it will cost a huge amount to upgrade.

Another drawback in using HSM is the lack of transparency in the model. Because most vendors do not allow independent review, there is a challenge in testing the effectiveness of random number generators in the hardware.

While HSMs have vulnerabilities, they remain to be a strong solution in protecting cryptographic keys by preventing unauthorized access.

Types of hardware security module

There are two major HSM types:
  • General-purpose
    The general-purpose hardware security module utilizes and strengthens the most common encryption algorithms. This is commonly used in basic sensitive data, public key infrastructures, and cryptocurrency.
  • Payment and transaction
    A payment and transaction HSMs are primarily used by financial institutions and payment merchants. These are created to protect payment information in cards, transfers, and other transactions. Payment and transaction HSMs help organizations comply with Payment Card Industry Data Security Standards.

Uses of HSM

HSMs have a wide range of capabilities that can be used in various scenarios. These capabilities range from verifying and securing digital identities, protecting the root of certificate authority keys, safeguarding digital signatures and payments, and maintaining a high level of trust by forming strong credentials for technologies.

Aside from these, HSM is also used in various industries in complying with ever-changing regulatory standards as its strong security features help organizations maintain the integrity and cyber trust in the workplace.

Attacks on software have become more prevalent recently. Given this, it is important for your organization to consider upgrading security through utilizing hardware. HSM can protect your organization from potential external breaches. Speak with us today to start your journey in the physical protection of digital keys.

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