Hard and Soft Tokens: Everything you must know

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Learn about the advantages and disadvantages with both hard and soft tokens to make the best choice for your protection.

In the modern cybersecurity environment, passwords alone are insufficient. Passwords are simply too easily leaked, stolen, or guessed. That’s why two-factor authentication and multi-factor authentication are gaining popularity.

Using multiple factors to authenticate a user’s identity usually involves a combination of passwords and tokens. Passwords are pretty well understood. That leaves us with the question of hard token vs soft token.

What’s the difference? How do hard and soft tokens work? Which is better? This article answers those questions.

Hard Token vs Soft Token

The hard token vs soft token question is actually pretty straightforward. Hard tokens are physical objects used to grant access to a restricted digital asset. Soft tokens also grant access to digital assets. But soft tokens are pieces of software, which makes them intangible.

Hard and Soft Tokens
Hard and Soft Tokens

Both hard tokens and soft tokens can be part of a two-factor or multifactor authentication system. The difference between the two is the risk factors associated with each type of token.

And, really, there doesn’t have to be much ‘hard token vs soft token’ debate. Your use case and resources will usually make the choice relatively clear.

What is a Hard Token?

A hard token is a hardware authentication device, hence the name ‘hard token.’ Hard tokens require a user to be in physical possession of their authentication device to access a digital asset or physical location. USB drives, keycards, RFID keyfobs, and even traditional keys can be hard tokens.

Hard tokens are often used in high-security applications. In most cases, a hard token must be physically stolen or replicated to break into a hard token secured system. That makes it much harder to bypass hard token security

How a Hard Token Works

In most hard token security systems, a hard token is issued to a user. The security system then assumes that, if the hard token is present, the person in possession of the token must be an authorized user. So it allows anyone with that hard token to access the system.

If you’ve ever used an electronic keycard to open a door or a gate, that’s a hard token security system. If you had to present your electronic keycard and enter a personal security code, that’s a two-factor authentication system that uses one hard token.

Most hard tokens use some sort of digital signal or signature to make each token unique. Keycards and keyfobs usually use a unique radio signal. USB keys often have an encrypted digital signature.

These digital signals and signatures are similar to the teeth of a traditional key. Each digital signal or signature only interfaces with security systems that have been built to recognize and unlock for hard tokens that have that signal or signature.

This is a pretty strong security design. But it’s not perfect.

Hard Token Pros and Cons

Hard tokens have definite security benefits. But, like most things, those benefits come at a certain cost.

Hard Token Pros

  • High security factor. The main security benefit of hard tokens is that it’s difficult to remotely breach hard token based security systems.

Hard token security systems need very little connectivity to work. Many hard token systems could operate without any internet connection. This makes them easier to isolate from the public internet and minimize the attack surface.

In most cases, a criminal needs physical access to the hard token to crack the security. While that’s possible—hard tokens can be stolen—it’s much less likely than a cyberattack that occurs through a standard internet connection.

  • Ideal for securing physical locations. Hard tokens are very convenient for keyed access to buildings and other physical properties. Keycards and keyfobs are easy to carry and use in physical security devices.

Hard tokens can work for securing digital assets. But it’s a little more complex to implement and use.

Hard Token Cons

  • Expensive. Unfortunately, hard tokens can be expensive to purchase and maintain.

Hard tokens get lost and need to be replaced. Adding new users to a hard token system is also relatively complex. And the security systems that use hard tokens can also be expensive, since they require security hardware that works with the hard tokens.

  • Breaches can be more severe. Although it’s more difficult to steal or replicate a hard token, a stolen hard token can cause a more severe security breach. Most users will have a single hard token that provides access to multiple systems. One compromised hard token often compromises multiple systems.

But, despite the associated costs, hard tokens can be an ideal security method if you need a high reliability security system that can work even if there’s no network connectivity or a high security system that requires network isolation to prevent remote attacks.

What is a Soft Token?

Soft tokens are digital authentication keys. They’re called ‘soft tokens’ because soft tokens are based on software. Single-use authentication codes, authenticator apps, or clickable authentication links are all soft tokens. Soft tokens can be stored on almost any device and are easy to create.

Hard and Soft Tokens
Hard and Soft Tokens

Soft tokens are one of the most common methods of two-factor authentication and multi-factor authentication. They’re more flexible and less expensive than hard tokens. And using a password and a soft token is much more secure than a password alone.

Although soft tokens different vulnerabilities than hard tokens, they’re a very cost-efficient way to improve your cybersecurity posture.

How a Soft Token Works

Soft tokens rely on supporting security systems and limited use for security. When a user attempts to log onto a digital asset, the security system will generate a soft token and send it to the user.

Most soft tokens use a secondary device or account for delivery. Usually a soft token will be sent to a user’s phone via SMS or email. The user must enter the code or click the link they received to finish the login process.

Once the soft token has been used, it cannot be used again. A new soft token must be generated each time a user attempts to log in. This makes soft tokens much more challenging to exploit, even if a bad actor gets hold of a soft token.

Additionally, the secondary device or account provides additional security, since the user must have access to their email account or device to receive the soft token. This offers an additional layer of security to soft token secured systems.

There are a lot of benefits to using soft tokens. But there’s also a downside or two.

Soft Token Pros and Cons

Soft tokens are a great middle ground for organizations that require more than just password security, but don’t have the need or resources for a hard token security system.

Soft Token Pros

  • Cost efficient. Soft tokens are cheap and easy to create. And implementing a soft token security system requires relatively little modification of your existing security system. Soft token security systems are also much lower maintenance than hard token systems because new users can be added and tokens can be generated on-demand.
  • Convenient. One of the biggest hurdles in any type of security is making the system secure and at the same time convenient enough that authorized users won’t try to bypass it to save time. Soft tokens are easy to use and add very little complexity to the login process.

Therefore, soft tokens are less susceptible to security breaches caused by authorized users failing to follow security protocols.

  • More secure than just passwords. Even though soft tokens are inexpensive and convenient, they still offer much more security than a password alone. Yes, it’s possible to breach a soft token secured system. But it’s much more challenging than a system that’s secured with just passwords.

Soft Token Cons

  • Easier to breach than hard tokens. Although soft tokens are a strong security measure, they rely on software and network connections to work. That makes soft tokens more susceptible to remote cyber attacks through an internet connection.

Tokens are generated and stored on a connected device. And soft tokens must be transmitted to the user’s device. All these required connections could be compromised and expose soft tokens while they’re being stored or transmitted.

Also check: How to Activate a Nigerian Bank Tokens

But, even though soft tokens aren’t an impenetrable security system, they’re a huge security upgrade over simple passwords

Deciding Between Hard and Soft Tokens

Settling the hard token vs soft token debate is a matter of assessing your security needs and resources. Here’s a quick rubric to help you decide which is the best:

When to Use Hard Tokens

  • Your security system secures physical locations. Hard tokens great for keyed entry. And the same hard token can be used to access digital assets, if your security system must secure both digital and physical resources.
  • You need top-tier security. Organizations that must have near perfect security—like Department of Defense contractors—should adopt some form of hard token security.
  • Your organization has a lot of resources to invest in security. Cost is the biggest limiting factor in using hard tokens. Hard token systems are expensive to implement and maintain. Your organization will need a fairly substantial security budget to support hard token security.

When to Use Soft Tokens

  • You primarily need to secure digital assets. If your security system mostly protects user accounts and electronic systems, soft tokens are an ideal option. Soft tokens integrate almost seamlessly with most digital security systems. And they’re easy enough to use that most users won’t notice the additional security measures.
  • You need a very cost efficient security system. Soft tokens are far less expensive to implement and operate than hard tokens. If you need the security of two-factor authentication without the cost of security hardware, use soft tokens.

Regardless of which method you use, adding hard tokens or soft tokens will upgrade your security system to at least two-factor authentication, which is a huge security upgrade from simple password protection. As long as you choose a token and start using it, you’ll be making the right choice.