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Today, cloud tokenization provider TokenEx announced that it had raised $100 million in Series B funding to enhance its solution to secure digital transactions.
TokenEx’s platform enables organizations to tokenize any structured data, so they can transmit and store data securely by exchanging tokens without storing any data on on-site systems, therefore protecting it from threat actors in the event of a data breach.
The provider’s abstracted tokenization-driven approach to data storage provides enterprise and decision makers with a solution that protects sensitive data against threat actors who’ve gained access to internal systems.
Using tokens to fight the inevitable
As hackers develop ever more sophisticated threats, breaches are a matter of if, not when. At some point or another, even the most prepared organization will fail to prevent a breach.
Last year alone there were 1,862 data breaches compared to 1,108 in 2020, which highlights that organizations are finding it more and more difficult to stave off advanced threat actors.
“It’s 2022 and cybercrime is at an all-time high. The rise in card-not-present transactions, which has been further propelled by Covid-19, has created an urgent demand for secure digital payments. That’s where TokenEx comes into the picture,” said Alex Pezold, TokenEx founder and CEO.
TokenEx aims to provide an answer to inevitable cyberattacks by ensuring that data isn’t stored in an on-site location that a cyber criminal can identify and breach. It ensures that if an attacker breaks into a system they’ll only be able to view tokens, which are useless.
“TokenEx collects data via API calls or managed file transfers before it enters an organization’s internal systems and then exchanges that sensitive data for nonsensitive data called ‘tokens’. These tokens can be sent to any API endpoint, creating a layer of abstraction that safeguards against cyberattacks, while also increasing freedom, control, and interoperability for its customers,” Pezold said.
The war against payment providers
The organization is part of the global tokenization market, valued at $2.3 billion in 2021 and expected to reach $5.6 billion by 2026, as more companies, retailers and merchants look to insulate themselves against data breaches.
The provider is competing against a number of other organizations including payment orchestration platform Spreedly, a payment ecosystem where users can capture, store and tokenize payments, which most recently secured $75 million in funding in 2019.
It’s also competing against secure payment providers like Very Good Security, a solution that collects and stores payment data that made $60 million in Series C funding in 2020.
However, Pezold says it’s TokenEx’s tokenization flexibility that differentiates itself from these providers. “While these companies typically specialize in either payments or privacy, TokenEx offers solutions for both with its ability to tokenize any structured data set.”
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