Client Profile
A multinational financial institution operating across Europe, North America, and Asia needed to modernize its mainframe testing and hybrid cloud operations while complying with strict data sovereignty laws such as GDPR and emerging regional privacy regulations.
With over 137 countries enforcing conflicting data protection requirements — and legal precedents like the US Cloud Act creating risks of cross-border data exposure — the client sought a solution that could guarantee control over encryption keys, enforce jurisdiction-based policies, and enable secure innovation in hybrid and multi-cloud environments.
Challenges
· Data Sovereignty Risk: Sensitive EU data could be accessed by foreign authorities under laws like the US Cloud Act.
· Mainframe Modernization: Limited test environments, high costs, and long provisioning times slowed innovation.
· Complex Compliance: Different countries required different data handling rules — hard to enforce consistently across mainframe, hybrid cloud, and container deployments.
· Security at Scale: Needed quantum-safe encryption and hardware key control for critical workloads.
IBM & eXate Solution
The institution deployed the eXate Digital Sovereignty Appliance integrated with IBM LinuxONE, IBM Z, and Red Hat OpenShift to provide a unified, compliant, and secure data management framework.
Key Components:
1. IBM LinuxONE + Hardware Security Modules (HSM)
a. Quantum-safe encryption with Crypto Express 8S adapters.
b. Hardware-secured key sovereignty — client holds encryption keys, not the cloud provider.
c. FIPS 140-2 Level 4 certified tamper-resistant infrastructure.
2. eXate Privacy Enhancing Techniques (PETs)
a. Real-time data masking and tokenization directly on z/OS.
b. Automated classification and policy enforcement across jurisdictions.
c. Granular access control with auditable logs for all data access and masking events.
3. Hybrid Cloud Integration via Red Hat OpenShift
a. Native OpenShift operators for eXate.
b. Cross-cluster policy enforcement using Advanced Cluster Management.
c. Jurisdiction-aware routing ensuring compliance with local laws.
4. Mainframe Testing Modernization
a. Combined eXate data masking with PopUp Mainframe virtualization to create production-like environments in minutes.
b. Reduced z/OS MIPS consumption by moving dev/test to LinuxONE or cloud containers.
c. Enabled secure, realistic test data without exposing sensitive production data.
Outcomes
· True Data Sovereignty: Encryption keys and data control remain with the client — foreign authorities cannot access usable data.
· Regulatory Compliance: Continuous, auditable adherence to GDPR, PCI DSS, and regional data laws.
· Accelerated Development: Test environments provisioned in ~10 minutes instead of weeks.
· Cost Reduction: Lower infrastructure costs by shifting dev/test workloads off expensive mainframe resources.
· Security Assurance: Hardware-grade encryption and policy enforcement across hybrid environments.
Why IBM Was Critical
· IBM LinuxONE & IBM Z provided the secure compute foundation with quantum-safe encryption and confidential computing.
· IBM Cloud & OpenShift enabled cloud-agnostic deployment, avoiding hyperscaler lock-in and native encryption limitations.
· IBM Consulting offered integration expertise, rule creation, and operational support, ensuring rapid adoption.
· Potential integration with WatsonX for automated data classification and governance.
Conclusion
By combining eXate’s advanced data masking, tokenization, and jurisdiction-aware routing with IBM’s hardware-secured infrastructure and open hybrid cloud orchestration, the client transformed a compliance challenge into a competitive advantage. This partnership allowed the organization to innovate rapidly, modernize its mainframe operations, and operate globally while complying locally — with provable, auditable security.