Board Briefing: Advanced Encryption & Paperclip SAFE®

Advancing data protection for 2026 and beyond

1. Why This Is on the Board Agenda Now

The organization’s current encryption posture was designed for a world where data lived primarily within organization owned on-premises systems and was only accessible by a limited set of applications and a manageable group of people. That simple, controllable world is long-gone. Today, sensitive data fuels AI, Agentic AI, Shadow AI, analytics platforms, SaaS ecosystems, multi-cloud architectures, and third-party production platforms. All accessed by an ever-changing, highly dynamic user group, both organic and synthetic. Traditional “encrypt at rest and in transit” controls are not capable of protecting data when it is most valuable and most exposed: while it is being used by production systems and AI. In 2026 and beyond, the strategic question is not whether we encrypt. Every organization is expected to encrypt data at rest and in transit. The harder, strategic question is: “Is critical data encrypted while the business, AI, Agentic AI, and third-party platforms actually use it at scale?” This is a rhetorical question, as the answer for the vast majority of operations is “NO”. That is the problem Advanced Encryption aims to address, and the Paperclip SAFE platform is designed to solve.

2. Current Risk Landscape

Key data points that frame the risk and investment decision:

• The average GLOBAL cost of a data breach is approximately USD $4.4M per incident, still enough to crater budgets even after a modest decline from 2024’s record highs.
• In the United States, the average cost per breach is more than double, now pegged at about USD $10.22M, a roughly 9% increase over 2024.
• There have been more than 2,500 publicly reported data compromises in 2025 through Q3, triggering roughly 200 million victim notices.
• Dark Web monitoring shows hundreds of additional breaches exposing 300M+ records this year alone, including email addresses, names, passwords, Social Security numbers, healthcare information, and financial account details.
• Large-scale “mega incidents” who’s numbers are not included in the exposure count, have exposed billions of records or tens of millions of fully readable customer identities in each, single event.

Practically speaking, 2025 has already delivered billions of compromised records, most of them accessed as functionally plaintext from an attacker’s perspective. This is not about how the attacker got in. This is solely focused on what they did inside the network. At-rest encryption did its job; the damage happened where the data is being used in support production processes (customer service, human resources, prescription processing, retail transactions, lending operations, etc), and now, AI. From a governance perspective, the key question is: “How much of our sensitive data would remain inaccessible and useless to an attacker if an AI-enabled, insider attack, or multi-cloud breach occurred tomorrow?”

3. What “Advanced Encryption” Actually Means

“Advanced Encryption” here is not just stronger ciphers. It is a data-centric protection architecture that keeps critical data encrypted across its full lifecycle, including while it is being used in production, analytics, and AI.

Core elements:

• Unified protection: encryption at rest, in transit, and in use as a single control model.
• Encryption-in-Use / Searchable & Queryable Encryption: ability to search, filter, edit, and perform analytics directly on encrypted data without exposing it as plaintext.
• Data-centric scope: field-level and record-level protection aligned to data classification, tenant boundaries, production usage, and policy, not just storage systems.
• Cryptographic agility & post-quantum readiness: support for evolving algorithms and keying schemes without re-architecting applications or AI platforms.
• Operational alignment: integration patterns that preserve user experience, application performance, and operational workflows for DBAs, engineers, and security teams.

This is where regulators, auditors, PET (Privacy-Enhancing Technologies), and cloud/security suppliers are converging as standard practice rather than optional innovation.

4. Paperclip SAFE® at a Glance

Paperclip Inc. brings over three decades of experience within highly regulated markets. Paperclip SAFE is an Advanced Encryption platform that keeps data encrypted while still allowing business applications, analytics, AI and Agentic AI services to operate effectively and more securely.

• Encrypts data as it is ingested, shredding, deduplicating, salting, hashing, encrypting, and indexing it immediately.
• Maintains searchable, privacy-preserving indices that allow search, retrieval, joins, and operations on encrypted data.
• Supports full CRUD (Create, Read, Update, Delete) operations without exposing raw plaintext to infrastructure, databases, the public internet, or cloud providers.
• Eliminates decrypt-to-memory patterns for production and processing, removing what used to be treated as “acceptable” plaintext exposure.
• Integrates with existing applications and data platforms with minimal code changes and no disruption to end-user workflows, delivering high-speed, near-native performance measured in milliseconds.
• Implements strong key management, segmentation, and separation of duties, consistent with regulatory expectations for data-centric controls and Zero Trust to the core data layer.

5. Strategic Benefits for the Board to Consider

Adopting an Advanced Encryption platform such as Paperclip SAFE delivers board-relevant outcomes across risk, compliance, AI strategy, and growth:

• Risk reduction & blast-radius control: eliminates database compromise by ensuring sensitive fields remain encrypted even if storage, infrastructure, AI pipelines, or backups are compromised. Segmented encryption policies greatly reduce how much any single incident can expose.
• Regulatory alignment & “Data Safe Harbor” posture: supports expectations under DORA, NIS2, PCI DSS 4.0, GDPR, HIPAA, SEC, FINRA, CCPA and data sovereignty regimes by providing data-centric, demonstrable protection and the ability to prove that exfiltrated data remained encrypted.
• AI & Agentic AI enablement with control: allows the organization to keep investing in AI, Agentic AI, analytics, and data sharing while treating AI as a non-human identity (NHI) governed by Zero Trust principles through to the database layer.
• Incident response resilience: greatly enhances the ability to contain breaches, and reduce notification scope as encrypted data remains unintelligible to attackers.
• Standardization across environments: provides a consistent Advanced Encryption model across on-premises systems, multiple clouds, SaaS platforms, archives, and third-party production environments, instead of a patchwork of incompatible encryption schemes.
• Strategic differentiation: enables secure growth and high-trust client acquisition in regulated markets by positioning SAFE as organizational resilience and a market differentiator.

6. Investment & Economics

Traditional “Advanced Encryption” projects are usually framed as large, multi-year initiatives with seven-figure budgets. Paperclip SAFE is structured to be adopted incrementally and priced to replace legacy encryption, not sit beside it. Key economic points:

• Entry pricing starts at USD $6,720 per year for a multi-tenant SaaS cloud model. Dedicated enterprise SaaS, on-premises, and integrated models are available.
• This base subscription includes up to 1 million structured records, 10 concurrent users, both data holder and data owner key vaults (Azure), and implementation support.
• At this level, SAFE can cost as little as $0.007 per record per year, depending on deployment type, number of critical data records, and users.
• Initial deployments can target the highest-risk data domains first (customer identity, financial accounts, claims, member data, medical records, loan details, cardholder data, archives). Sandbox evaluation and Proof-of-Concept programs are supported.
• Even a single avoided or materially reduced breach can offset years of SAFE subscription cost, given average breach losses in the multi-million-dollar range.
From a board perspective, this is a relatively small, predictable operating expense that directly addresses a large and growing tail-risk exposure.

7. Recommended Board Actions

Recommended actions for the 2026 planning cycle:

• Declare Advanced Encryption a strategic capability for AI, Agentic AI, analytics, and cloud workloads, not a niche experiment.
• Request an impact assessment quantifying how much of the organization’s sensitive data would remain protected (encrypted and unusable) if current perimeter and platform controls failed. Paperclip
can assist by recommending an independent impact assessment organization for this task. • Approve a pilot deployment of Paperclip SAFE focused on one or more high-value data domains and AI / analytics use cases.
• Require that new AI, data platform, and major application initiatives evaluate Advanced Encryption as a standard design consideration, particularly for production data and third-party integrations.
• Ask management for a roadmap that aligns the organization’s encryption strategy with post-quantum readiness and crypto-agility, evolving regulatory expectations for PETs and data-centric controls, and the organization’s AI, Agentic AI, and data-sharing strategy.

This handout is intended to support board-level discussion and decision-making on whether and how to incorporate Advanced Encryption and Paperclip SAFE into the organization’s core data protection strategy for 2026 and beyond.