“The iPhone 3GS includes a hardware encryption chip that uses the industry-standard AES 256 protocol (that’s the Advanced Encryption Standard, with a key length of 256 bits). Hardware encryption enables a device - a phone, a hard drive, or what have you - to be nearly instantly wiped by erasing the encryption key stored on the device.”
— iPhone 3GS Offers Enterprise-Class Security for Everyone (via John Gruber)