Field-Level Encryption in Marketing Cloud encrypts specific fields at rest but restricts operations such as filtering, querying, or segmentation on those fields. You cannot perform SQL queries or create filtered sends directly using encrypted fields.
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Exact Extracts from Salesforce Documentation:
Source: Salesforce Help - Field-Level Encryption Overview
# "You cannot use encrypted fields in segmentation activities, query activities, or filters in Marketing Cloud.
These fields are encrypted at rest and are only decrypted at send time."
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