Basically it's a USB security key that supposedly encrypts data stored to the thumb drive using AES, provides remote encrypted storage, creates a secure connection to the internet, and deletes your browser's cookies and history files.
Hitachi's version "scrambles data using a password-generated key" as the data is written, and then descrambled with the key as it is retrieved using the highly-touted Advanced Encryption Standard (AES) algorithm.
In addition 128 bit AES encryption provides data protection and in particular can be used to rapidly erase the encryption key so the drive can be repurposed without concern about the old data being accessible.