In contrast to file sharing and storage solutions like Dropbox that only encrypt your files during the uploading process Secure data rooms encrypt every document as it moves between servers and whilst in storage. This is necessary to prevent hackers from accessing your data when it’s lost.
However, it is important to keep in mind that data rooms are only as secure as the security measures implemented by the server hosting them. So, although encryption of data at rest is vital, it’s still not enough to guarantee complete security. Additionally, it’s worth asking if a data room’s system encrypts the temporary files generated by downloading documents to the browser. If not that could mean thousands of unprotected files sitting in plain view on a server that can easily be hacked.
Another key feature is the capability to add personal notes to a document that can only be viewed by the person who wrote them – this reduces the risk of third parties being able to view confidential information and enhances collaboration during due diligence. The most secure datarooms have dynamic watermarks that are updated in real-time, preventing uninvited file sharing. They can also be used to track the origin of a file in the event that it is leaking.
Make sure that the data room you are considering is in compliance with the industry standards for security by checking if it has ISO 27001 or similar certification. Find a data room with strong encryption and detailed reporting on access and activity.
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