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Putting together a simple guide to encourage others to take advantage of this easily-missed feature in Alteryx Designer.
There may be occasions when you need to incorporate passwords or tokens into your workflow, perhaps to interact with an API (very common use case). Workflow encryption (including macros and apps) ensures that the version produced from the encryption process cannot be used to extract said passwords or tokens, nor anything else of the design except for the metadata and settings of any Interface tools - these remain in plaintext.
The next part was explained to me by Matt Hochstein (Alteryx). When it says serial numbers, what it is really referring to is the identifier for the license owner. For licenses by user, this refers to the email address against said license.
The new file generated in the output location can only be run in the Alteryx Designer licensed to that email address.
The unencrypted original version should not contain passwords or tokens. The easiest way to blank these out if used everywhere is to store them in a Text Input tool with Append wherever they need to be injected.
Glad I found this post - finally! It should be easier to get this basic information from this site about workflow encryption & 'restrict use to specific serial numbers'. Now I know they are not random serial numbers.