The Cipher was a component of the new Intersect computer, stolen by Fulcrum sometime before the events of "Chuck Versus the First Date." It was retrieved by the team, stolen again by Fulcrum, then recovered again, and the device was installed in the new Intersect.
The device recovered by the team, however, was a Trojan Horse or booby trap and exploded upon uplinking, killing Director Graham, six CIA agents, and destroying the rebuilt Intersect.
General Beckman described it as the "brain" of the Intersect in Chuck Versus the First Date. The real Cipher was subsequently recovered in "Chuck Versus the Seduction." Neither episode revealed the exact function of the Cipher in the Intersect.
In "Chuck Versus the Predator", Beckman also implied that the first Cipher was developed by Orion.
In "Chuck Versus the Other Guy", The Ring director revealed that The Ring had their own Cipher, although when it was looked over by the CIA many flaws were found.