What is a Hardware Security Module (HSM)?

I keep hearing about Hardware Security Modules in security discussions. Can someone explain what an HSM is and what it’s typically used for, in simple terms?
 
A Hardware Security Module (HSM) is a dedicated, tamper-resistant device that securely generates, stores, and manages cryptographic keys. It performs encryption, decryption, and digital signing within protected hardware to prevent unauthorized access. HSMs are widely used in banking, authentication systems, and any environment requiring strong, hardware-based security.
 
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