A USB drive that stores encrypted data. The encryption may be performed by third-party encryption software or the software that comes with the drive. In either case, the software is configured to encrypt the data before writing to the drive and decrypt after reading. Hardware-Based Encryption A more secure approach is to embed the encryption algorithm in a chip within the drive itself, in which case encryption is mandatory for all data on the drive and cannot be disabled. In addition, hardware encryption is much faster than software-based encryption. See USB drive.