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Cryptographic algorithms are measured in terms of key length. Following is the list of some popular symmetric key algorithms: DES (Data Encryption Standard) – 56 bits IDEA (International Data Encryption Algorithm (IDEA) – 128 bits RC2 – (block cipher) 1-2048 bits RC4 (stream cipher) – 1-2048 bits Rinjdael – 128-256 bits

Attacks on Symmetric Key Algorithms

Following attacks have been reported on symmetric key algorithms: Key Search Attacks Cryptanalysis System-based Attacks Key Search (Brute Force) Attacks In this type of attack an attempt is made by the attacker to decrypt the message with every possible key. Thus, the greater the key length, the more difficult it is to identify the key. Cryptanalysis Encryption algorithms can be defeated by using a combination of sophisticated mathematics and computing power so that many encrypted messages can be deciphered without knowing the key. Such type of an attack is called cryptanalysis. System-Based Attacks In it the attack is made on the cryptographic system that uses the cryptographic algorithm without actually attacking the algorithm itself.

Public Key Algorithms

Following is the list some popular public key algorithms: DSS – Digital Signature Standard based on DSA (Digital Standard Algorithm) – key length is between 512-1024 bits RSA Elliptic Curves

Attacks on Public Key Algorithms Key Search Attacks

The public key and its corresponding private key are linked with each other with the help of a large composite number. These attacks attempt to derive the private key from its corresponding public key using that number. According to an estimate 1024 bit RSA public key may be factored due to fast computers by 2020. Note that both symmetric and asymmetric algorithms are based on different techniques. In case of

109 asymmetric algorithms the increase in key length does not much increase the difficulty level for the attacker as compared to symmetric algorithms. Thus, a 128-bit RC2 symmetric key may prove to be much stronger than a 1024 bit RSA asymmetric public key.

Analytical Attacks

Such attacks use some fundamental flaw in the mathematical problem on which the encryption system itself is based so as to break the encryption. Quantum computing is the branch of computer science that deals with the development of cryptographic algorithms. It can also be used to find flaws in the cryptographic system/algorithms and to launch attacks.

Electronic Payment Systems

Most of the electronic payment systems on internet use cryptography in one way or the other to ensure confidentiality and security of the payment information. Some of the popular payment systems on internet include the credit-card based payment systems, electronic checks, electronic cash, micro-payment systems (milicent, payword etc.)

The Process of Using Credit Cards

It may be useful to see how payment is made through a credit card in the traditional sense. Fig. 1 below shows the steps to be followed in this regard: Issuer Bank Cardholder Account Acquirer Bank Merchant Account Card Brand Card Holder 1.Issue Credit Card Merchant 2. Show Credit Card 4. Capture 3. Authorization 1.Issue Credit Card

6. Amount Transfer 5. Payment Request

Fig. 1 1. A potential cardholder requests an issuing bank in which the cardholder may have an account, the issuance of a card brand (like Visa or MasterCard). The issuing bank approves (or denies) the application. If approved, a plastic card is physically delivered to the customer’s address by mail. The card is activated as soon as the cardholder calls the bank for initiation and signs the back of the card. 2. The cardholder shows the card to a merchant whenever he or she needs to pay for a product or service. 3. The merchant then asks for approval from the brand company (Visa etc.) and the transaction is paid by credit. The merchant keeps a sales slip.

110 4. The merchant sends the slip to the acquirer bank and pays a fee for the service. This is called a capturing process. 5. The acquirer bank requests the brand to clear for the credit amount and gets paid. 6. Then the brand asks for clearance to the issuer bank. The amount is transferred from issuer to brand. The same amount is deducted from the cardholder’s account in the issuing bank. Note that in case of a credit card the issuer bank charges interest from the client at a specified rate on the amount lent. On the other hand, in case of a debit card no such interest is payable since the customer uses his/her own money in that case.

Virtual PIN Payment System

It is one of the earliest credit card-based systems launched for the internet in 1994 by a company; First Virtual Holdings, Inc. Virtual PIN system does not involve the use of encryption. Payment is made through the credit card in this system. The objective was to allow the selling of low-value information items without the use of any special client software or hardware. Both merchants and buyers are required to register with First Virtual (FV). A buyer registering with FV forwards his or her credit card details and email address to FV and in exchange receives a pass phrase called, Virtual PIN. Buyer makes a telephone call to FV to provide his/her credit card number. FV establishes a link between the Virtual PIN and the credit card number without using the credit card number on the network. A Merchant goes through a similar registration process. He provides his bank details to FV and is given a merchant Virtual PIN. The merchant can now request to process payments from registered FV customers. The transfer takes place with the help of Automated Clearing House (ACH) service. Note that an ACH is a centralized system to which different banks are electronically connected forming a network for clearing payment requests. At the end the payment proceeds from the credit card issuer bank to the account of the merchant with acquirer bank (merchant’s bank) through ACH, after FV deducts a per-transaction charge for its services. Fig. 2 below shows the working of Virtual PIN payment system. Buyer 2. Account ID Valid? 3. Account OK! 5. Transaction Details 1. Account ID 4. Information Goods 6. Satisfied? 7. Accept/Reject or Fraud Indication Web Server (Selling Goods) Web Server (Selling Goods) First Virtual Internet Payment System Server First Virtual Internet Payment System Server Buying with First Virtual Fig. 2 A buyer browses the web server where FV registered merchant is selling goods. The buyer is asked to enter his/her Virtual PIN by the merchant site

(step 1).

Merchant queries the FV Internet Payment System Server (FVIPSS) to confirm Virtual PIN (

step 2).

If Virtual PIN is not blacklisted

(step 3)

, the merchant

111 may acknowledge this fact to the buyer by email and sends the goods, and also sends transaction details to FV

(steps 4 & 5)

. FVIPSS or simply FV server sends email to the buyer if the goods were satisfactory

(step 6).

There are three possible answers to that

(step 7)

. If the answer is “accept” then the payment proceeds, in case the answer is “reject” it means that either the goods have not been received or the buyer is not satisfied with the quality of goods. Then the payment is not made to the merchant. If the answer indicates “fraud” it means that the goods were never ordered. In such an eventuality the FVIPSS immediately blacklists Virtual PIN so that it cannot be used in the future. Time period may be a few minutes to a few days for answering the email in step no. 6 above, otherwise FV shall proceed to arrange the payment. If a Virtual PIN has been stolen and the buyer does not indicate fraud within the time period for answering the said email the bogus transactions are possible before the Pin is finally blacklisted. A stolen credit card number can also be used to set up Virtual PIN associated with an email address controlled by the attacker to carry out bogus transactions.

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