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<nettime> Jean Camp's notes on FC01
R. A. Hettinga on 13 Mar 2001 17:26:51 -0000

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<nettime> Jean Camp's notes on FC01

     [orig To: Digital Bearer Settlement List <dbs {AT} philodox.com>,
      dcsb {AT} ai.mit.edu, cryptography {AT} c2.net, coderpunks {AT} toad.com;
      orig Cc: Jean Camp <Jean_Camp {AT} harvard.edu>]

I saw Jean thrashing these every day as I walked by, and asked her if we
could see them.

Thanks much, Jean!

(Word: *Don't* piss Jean off, boys and girls. In the Q&A during the voting
panel below, I saw her haul off and throw a rock, from the back of a very
large conference room at the Marriott, and put one of the esteemed panel's
eyes out. He didn't even notice his lack of binocular vision until it was
pointed out to him later that something was dangling on his cheek... :-)).

I converted the following to text, fixing the spelling a bit, but I bet you
can guess where the italics used to be...

ref as FC01 Notes, L. Jean Camp, http://www.ljean.net/FC01notes.html, March
1, 2001.

Financial Cryptography 2001

These notes are from the morning session of Financial Cryptography 2001 in
The Cayman Islands in the British West Indies. My sometimes-relevant asides
are in italics.

The conference reflected both a field that was coming of age and an
academic area that is getting entangled in the nasty interdisciplinary
world. Issues of computation efficiency, device capacities, implementation
in real world financial systems, and risk management were all addressed.
Although I did not count I would guess something more than 100 attendees.
Because the conference is front-loaded, that is the morning sessions are
academic and the afternoon sessions are commercial, the attendance at the
earliest sessions was highest.

The afternoon sessions were vendor sessions. You can go to their sites to
check out what the vendors say for themselves. The sponsors were nCipher,
Bibit, Intertrust, Hush , Zero Knowledge, IBM, CertCo, CertiCom, RSA and
the borg mothership.

As in all conferences the value is in the dialogue as much as the
presentations. I did not review my paper, for obvious reasons, the slides
are at www.ljean.net/fc01.pdf. However, I also did not review the paper
immediately before mine, as I was quite busy tensing up.

There were two non-crypto papers. There was one paper on analysis of trust
from difference disciplinary perspectives (mine) and one paper on analyzing
the cost of MicroMint. I wonder if the financial privacy laws happen in the
US if some of the papers next year may be on regulatory compliance.


The first paper was Amortized E-cash by Moses Liskov and Silvio Micali at
MIT. Moses presented it.

Okamoto was the first to offer a proposal for divisible e-cash, and is used
by the authors as the basis for comparison of their own coinage. In
addition to past work on divisible e-cash, there has been much work to
create definitions for the requirements for divisible e-cash. In this case
the authors developed the requirements and worked from there.

The core idea was to amortize expensive crypto operations over multiple
coins by dividing the coin into two two parts. The goal is provide cash
that is both off-line and anonymous. Off-line implies double spending, so
identity is embedded in the coin. Spent once, anonymous, spent twice
identity is released. The basic idea is that two expenditures create two
equations, thus solving for identity.

Embedding identity requires uses zero knowledge protocol. However, zero
knowledge protocols are expensive. Consider the cost when $100=10,000cents

Coins from one wallet can be linked to coins with other wallets. Models the
identity lost under a single wallet on the conceptual model of a single ATM
transaction. Anonymity is lessened because the wallet becomes a pseudonym.
Each wallet has a single wallet-defining subcoin. Authenticated by bank,
includes user's identity, specifies all coins.

Wallet is a Merkle hash tree. Root & depth defines coins. Wallet of depth d
has 2^d subcoins. Common subcoin is the root.

Each coin is an ephemeral k, or commitment. Common subcoin includes root,
depth, PK, Ek(identity). Essentially core for double spending is Schnorr
signature which exposes the signed identity by exposing the key when there
are two transactions using the same subcoin (which is a subcoin-specific
key). The existence of two transactions and the shared wallet/coin that
contains identity.

Q& A argues that the contribution of this paper is not primarily efficiency
given the ZK protocol but rather off-line divisible coins with strict
security assumptions. Moses agrees. The questions were rather pointed.

The second paper was Offline payments without trusted hardware by Matt
Blaze, John Ioannidis, Angelos Keromytis (ATT, ATT, Upenn)] presented by
Angelos Keromytis.

The design decisions began with a single observation: avoid hardware
because trusted hardware fails catastrophically. When it is broken, all the
wallets are broken.

As opposed to concentrating risk, distribute risk in an appropriate
per-transaction manner. Tolerate and manage risks of bad transactions. Use
credentials to encode risk management. User has credential, which encodes
risk profile. Assumes occasional communication for credential validation
but does not require constant connectivity.

In order the create a reasonable level of risk management the maximum value
is low (e.g. $1.25) and credentials are short-lived. So there is no CRL
rather risk management is embedded with credential extension. The authors
argue that this is not unlike the credit system.

This is based on the keynote microcheck system developed by UPenn and AT&T.
Based on a Trust Management Language. Claims other systems require their
own clearance systems, although this was not the case with NetBill or
FirstVirtual, or any early aggregator.

Payments are vendor-specific microchecks. Vendors aggregate. Vendor
determines how much risk to accept. Keynote compliance system is the
vendor-specific risk-management mechanism that requires that the vendor
manage his or her own risks.

Compared to newspaper stands, where there is little theft. Implemented on a
Palm with a PocariSweat machine using a Linux PC as merchant hardware and
ssl port, gnu utilities on Palm hardware under Linux.

Billing or clearing service must have pre-existing relationship by payers.
Note that AT&T would be a good party for billing given their micro-billing
transactions. In order to support this the central party would have
clearance, party fees, or transaction percent.

No claims on anonymity.

The work of Ian Simpson isn't referenced but could inform their
implementation IMHO. Ian's paper, Modeling the Risks and Costs of Digitally
Signed Certificates in Electronic Commerce is at

The next paper was one of two non-crypto papers. This paper was focused on
order of magnitude calculations which examined the possibility of a trial
Micromint, Practical Problems for Building a MicroMint by Nicko van Someren
of www.ncipher.com

Someren is the CTO of a company that is trying to implement secure hardware
and argues that the economics of MicroMint make it impossible to introduce
because you can scale up but not down.

As you may recall, using the birthday paradox MicroMint uses coins that are
hash collisions. Minting is cost -effective because of great economies of
scale. Extra criteria can be added, so the scheme can be n-way hash. Coins
have a life span based on the work factor of the has collision. Once
spending begins anyone can mint coins but it takes time, and the bank has a
head start.

"It is traditional at this conference to present an e-cash scheme so I
thought I would make one up". (but doesn't offers secure hardware)

Not anonymous. Double spending is tolerable because of very low value
transactions and rather traditional risk-management schemes.

Problem: dirty money is cheap. Business model is spending false money while
banks are living off interest and fees. Argues that attackers have far more
money, but Moore's Law helps the attacker. So Someren argues that in fact
the attacker can produce fraudulent cash because a borderline attack,
including Moore's law Argues that for the system for function effectively
the initial investment will be about $100M. MicroMint scales up but not

Paper in the proceeding argues you need dozens of floor to ceiling racks
and uses .5 megawatt of electricity to create hash engine. 10,000 sq.-ft..
then sorting the hash requires .25 terabyte of storage and then sort it.
Scales up but not down.

Basically only a government could do it. In general argues that assumptions
were cryptographically valid at the time (six yrs ago) given hardware
costs. Thus MicroMint is not feasible today. The need for massive scale in
MicroMint makes this system far more expensive. However he neglects the
secret predicate option. His focus that a system must be able to function
in small prototype. Digital signatures allow this. He proposes using secure
hardware since it is easier to scale up.

The next section was a panel on Digital Rights Management which was chaired
by Yair Frankel who argues the keys to DRM are efficacy, customer
acceptance, and diffusion.

David Kravits, WAVE

Management of conditional Access keys

*	requires compliance of set-top box (STB)

*	assume CAM is good and STB is compliant, then the flow from STB to
monitor is unencrypted

*	proposed enforced licensing STB as legislative solution, forced
compliance and make content inaccessible with non-compliant STB
*	require phone-home

Wave is concerned with set-top boxes where consumers make multiple content
copies. CAM not only determines what consumers watch but must "log
attacks". Proposes that only compliant monitors are allowed.

Pirates may not be backward compatible but those who offer consumer
hardware must be. (This is a bit ironic given that the speaker advocates
only allowing content to go into compliant monitors.)

Consolidated hardware deployment offers the opportunity to replace point
solutions by shared solutions and preserve user privacy yet handle

Barb Fox: Microsoft Web TV

No one has been deterred by the total historical failure of detailed
controls. At least three competing DRM standards: W3C, CableLabs Thuis DRM
is a life form which is amazingly resilient. </humor>

Conditional access currently consist of a massive number of
supplication-specific systems including Digital RM systems, black box crypto

Barbara suggests that the problem with digital information is that there is
a completely immature risk model. Where in physical or analog systems the
risk model is mature.

The stakeholders have completely different design parameters. First
industry want authentication, encryption, renewable, revocable. However for
there to be widespread adoption the system must be coherent, cheap,
privacy, and use rational risk-mgt. Finally for efficacy the system must be
robust, scalable, and support flexible decentralized mgt.

Jeremy Wyant: Ntru

Device-based systems are what he proposes. He sells a toolkit.

He provided an overview of the possible set of technologies: watermarking,
fingerprinting, encryption, authentication, network scanning, fees on blank
media, and an honor system . He agreed with/repeated/expanded on what Barb
said, in detail, e.g. flexibility in terms of computability and ease of use.

Proposes that a minimalist DRM on trusted devices that is supported by a
critical mass of content providers would be widely adopted.

Thomas Sander of Intertrust

DRM is dynamic in both business model and technology.

The current goals is convenient anytime anywhere accesses to your music.

The ultimate goal is to try to tie the right of use of content to a
particular person. Thomas proposes lockers which track what you have rights
to access, argues that portability is the core current technical challenge.

Usability is terrible. However, second generation products are improving.
Must be backward compatible.

Strong legal protection will protect DRM investment because there is no way
to run a legitimate business using copyrighted content on the net without
consent of rights holders. OTOH, technology companies influence content

NCa: Southern Ca doesn't get it

SCa: Yes but we already Have It, and to get content on-line you have to
play our way.

Loss management needs to be a critical element. Consider that in Pay TV
most protection schemes have been broken but there is still plenty of money
to be made. In DVD there was no proven monetary damage, in terms of crypto
it was broken but in terms of business DVD still works.

He suggested that versioning is not like QoS, as it exist in the net access
market. If you could combine ease of use with Napster with fidelity that
commercial service can provide people are willing to pay for it.

Audit v privacy is a major research issue. Intertrust has deployed
technology with Universal, BNG, and Bertelsmann. Learned that the shopping
cart model works better than the wallet model in US. In Europe the wallet
model works better.

Conclusion: economics is on the side of digital distribution and the
technology for adequate DRM already exists.

Scott Moslowitz, BlueSpike

Scott starts by saying his has very different views. Advocates stenographic
ciphers with traditional encryption. Believes that artist should sign work,
and then trace and bust the thieves.

There are two different risk models. The current concept of DRM is pay
before viewing. In constrast watermarking models a "look and then pay or we
trace you".

Market note: 10 movies account for 90% of store revenue and 83 recordings
provide 25% of sales. This implies that under the current blockbuster model
DRM could focus on very few titles. Soctt believes the highly skewed
blockbuster model is a result of free consumer choice not market structure
and that this distribution will continue on the net.

Argues that consumers advocate DRM that 'reduces value'; fair use and first
sale are culturally ingrained and reasonable. He believes in risk Mgt but
calls it balancing copyright and privacy. Security system must first add
value and then do no harm.

Audience: I am disturbed by this discussion. DRM is not a technological
problem. DRM takes away rights like Fair Use

Audience: How to balance rights and detecting infraction vs. anonymity and

Joan Feigenbaum: There is an unstable bubbling legal cauldron. The whole
challenge is not technology or law but rather business.

The panel agrees. (DRM is narrow and economically deterministic.)

Audience: Napster allows you to find music on the hard drive of someone who
has similar interests. Napster allows consumers to be dj's etc. Napster
allows customers to listen first. Napster has radically incresed CD sales.
Scott: Napster has radically reduced singles sales.

Matt Blaze suggests that those who would remove fair use and first sale
through technology lose the social bargain of copyright. David suggests
that putting the ball in the owner's courts.

Thomas: It is not the lack of DRM -- it is the content owners. The content
owners are making plenty of money and are not interested in cannibalization
of their own business model. DRM is just an excuse or attempt to keep
business models unchanged.


The first session is on Groups and Anonymity. Stuart acknowledges that this
was kind of an umbrella session, of good papers that need not necessarily
be grouped together.

Group authentication protocol: prove one belongs to a group without
revealing identity. Requires the following steps:

*	Setup: an authority chooses parameters
*	Registration: a user becomes a member of a group w/ or w/o revealing
*	Anonymous authentication: anonymous certificate

*	Completeness: works with honest players
*	Soundness: only group members can be authenticated
*	Anonymity: non-revocable anonymity
*	Efficiency: less strong requirement

Biblio:F C 99: Shechter, Parnell, Hartemink and FC 00: Handley

I however think that the work of Brands provides the ability to prove group
membership. But that is a general expensive solution and this may be a
cheaper specific solution.
Setup: p, g generator, u public constant
z,w private keys of authority
v=uw mod (p-1)
User data:
User secret key x
User public y=gx mod p
Keys are used for other applications to prevent users handing off anonymous
Authority chooses a in space of g
Authority computer
a1=(gyz)a mod p
a2=a w mod (p-1)

User now has a certificate (a1, a2). User can prove she knows discrete log.
You can use Schnorr or zero knowledge protocol to prove this.

Criticisms of Homage in the paper.

Suppose a user knows n,m such that using m=nz mod p. Then such a user can
construct a valid, bogus, proof of membership. The user can obtain the zth
root of some number m by constructing her challenge in verification of
soundness. A solution is proposed. (Sending hash of verification, rather
than verification which is zth root of m)

Authority can break anonymity by using different secret keys z to computer
certificates and then distinguish users during authentication. In order to
avoid this it is necessary to avoid verification. The author proposes a new
mechanism using zero knowledge proofs for verification.

Audience member argues that protocol is not completely broken. In fact,
audience member argues that all the flaws found and fixed in the protocol
were found and fixed last year. Is the protocol broken or going through
normal iterative improvement? The first paper was On the Security of the
Homage Group Authentication Protocol. This paper was presented, and
accepted at a previous FC when the author was a high school student. Both
respect and concern for a young collegaue resulting in somewhat harsh

The next paper was Anonymity without Cryptography by Dahlia Malkhi and Elan
Pavlov, and Dahlia presented it. This was an excellent presentation.
Crypto-free communication assuming secure channels using Anonymous
Multi-Party Computation uses Chaums mixnets.

Really it is with less crypto (as Dahlia notes first thing in talk). This
would allow use with pervasive devices with low processing power. No
infrastructure required.

There are fairly secure channels use without crypto - e.g. regular mail.
The initial secure channel assumption is only needed to bootstrap the
protocol. Also, there already exist SSL connections so this requires no
additional infrastructure after initial communication between users.

Describes mixes, which is effectively onion routing with the removal of
timing attacks. Of course onion routing/mixing requires multiple public key

As opposed to encryption the messages are broken into shares and the
initial shares are sent as elements. At each level message values are split
and remerge. So any function used must be homomorphic. F(a%b) = F(a) % F(b)
where % ={+, *, xor,Š} Thus it is restrictive but practical.

Like this:
Initiator and recipient agree on permutation and function
Initiator: m = (x1), (x2)
Sends the tuples as distinct messages
Second layer performs permutation (y1, y2)
Recipient receives (x1, y1) and (x2, y2) and can calculate m
The goal here was the creation of a new primitive. Its main practical
feature is that it requires no heavy calculation of the client. This is a
building block for various security applications, perhaps ideal for
wireless environments.

Then Fair tracing Without Trustees by Dennis Kugler and Holger Vogt was

A protocol which provides coin tracing without owner tracing. Goals of
protocol are:

Legal tracing: tracing is legal if approved by judge
Illegal tracing: illegal if not approved by judge
Fair tracing: if legal tracing is possible but illegal tracing is not

In order to enable this tracing is detectable after the fact. Therefore if
illegal tracing has occurred it is detectable, traceable is auditing and
illegal tracing is provable.

Decision to trace coins must be made at generation of coins. After the coin
is spent the validation of the coin both implements and identifies coin
tracing. Gross generalization: the coin is generated with a second key, x=
a PKB (mod p) as opposed to PKB(mod p). No additional trusted parties that
hold sensitive data. The goal is to build in later auditing rather than
long term trust. (Generally what is done in terms of governance today.)

Audience has mixed feelings. Is traceable anonymity anonymity?

Why the War on Money Laundering should be Aborted

This was the big event talk by Richard Rahn.

Right wing rant about money laundering which focuses primarily on the drug
war, since the drug war is such an exercise that could be called ludicrious
it it were not so relentlessly cruel. Rahn is a Pepperdine School honorary
doctorate. Opposed to money laundering controls. Notes the political
spectrum agress with im, defines it as all the way from the Cato Institute
to the Enterprise Institute. Invites all to join him in his plan-free goal
to end controls on money laundering. He has a book out, The End of Money
and the Struggle for Financial Privacy; Discovery Institute; ISBN:
0963865420. (I do too, mine is Trust and Risk in Internet Commerce MIT
Afterwards I asked him what his plan was. I proposed that the Tobin tax be
adopted in exchange for tax evasion money laundering, while the drug war is
a distinct issue which could be opposed on its own terms. I still don't
know what he thinks about the Tobin tax. I know we are both against the
drug war. But money laundering is also used, for example in the trade of
women and children, and the slave trade in general example the press
release here:
or http://www.friends-partners.org/partners/stop-traffic/1999/0888.html The
drug war issue is tangential to the money laundering issue. On money
laundering the issue is: are we willing to give away the rights of the
money on the premise that few medium-sized fish will be caught. I agree on
the outcome but not on the arguments.

Provable Secure Implicit Certificates by DRL Brown, R Gallant, SA Vanstone

Implicit certificates contain a user's identity, data D, and CA's public
key which together can be used to reconstruct the public key of the user.

In earlier implementations the CA knows the private key of the user This
paper produces a self-certified implicit certificate scheme meaning that
user generates private and public keys.

Uses El-Gamal signature key. The CA and the user contribute to the private
key. Verifier can compute the user's public key using public information
([public data includes an elliptical curve point, user identifier, CA
identity, and expiration date, serial #)

This system has considerable computational savings because the computation
of the digital certificate and verification of user (e.g. user proves
knowledge of private key) are integrated. This produces at least a factor
of two improvement in processing overhead.

Next Joan Feigenbaum presented Nonmonotonicity, User Interface, and Risk
Assessment in Certificate Revocation, by her graduate student Ninghui Li
and herself.

Revocation is a method of managing risk rather than providing security. Has
three recommendations.

1.	UI of PKI should be clear and simple
2.	Difficult of revocation is caused by temporal non-monotonicity
3.	A certificate illustrates that the issuer believes a statement at
issuer time t
4.	A revocation of a certificate should cancel the certificate and
nothing else
5.	A certificate that serves diverse applications should have flexible
revocation schemes
6.	The UI of a PKI should support auditing
7.	We recommend not allowing certificates to be put on hold in order to
simplify auditing

CRLs proves not that a binding is valid but rather to update the fresh time
of all valid certificates

Stuart Stubblebine (sp?) suggests that he has previously published these
axioms in previous FC

Again I think Ian's work would be helpful.
Next was a paper on Mutual Authentication for Low Power Mobile Devices by
Markus Jakobson & David Pointcheval.

Mobile apps have strict power and computational limits. Also, mobile users
interact with a range of switches not all of which are trustworthy. Thus
mutual authentication is required.Using Schnorr the computation can take
place in pre-processing. It enables mutual authentication.

Bob decrypts an El Gamal ciphertext to authenticate himself. Alice who has
low power, uses Schnorr to authenticate herself. For a designated server
Alice can precompute everything. However, it seems to me that the server
usually knows which mobile connection is coming while the client is less
aware of handoff management.

Here are a couple of other paperes on wireless commerce:
www-csl.cs.colorado.edu/csci7000/mobile_papers/peirce99.pdf and the O
project which I am geogrpahically required to mention [PDF]
info.lcs.mit.edu/data.ws/Research%20Highlights%20rev.%205.pdf Notes on a
wireles e-commerce conf which complement this paper are available at


Rump Session Notes from Tuesday

The European Bridge-CA Connecting Existing PKIs

Bernhard.esslinger {AT} db.com

Apps today assume PKI but how do you connect multiple PKIs between
businesses/consumers. In fact the problem is too many PKIs, and there are
problems with all of them

*	PGP-requires experienced user, users make bad security mgrs.
*	Identrus- good only for B2B
*	Netscape -trust software provider
*	n:n complete network, doesn't scale, excessive
*	Bridge CA: star topology best way to address, managed by NFT NGO

Efficient & Secure Protocol for Stock Market

Shin'ichiro Matsuo NTT

Proposes a broker-free market that uses PKI to identify the right of users
to buy and sell.

Proposes hashing (stock, prices) & look for matches, search mechanisms
allows users to expose upper and lower bounds of price range and search
matches highest acceptable seller price with lowest acceptable buyer price.
Provides fairness, verifiability, un-deniability, anonymity

Claim: will always find Paredo optimal price

How to Leak a Secret is presented by Shamir

starts with Relationship between Finance and Crypto: using the Time=money
email joke

Seriously, the Goal: anonymous leak that verifies group membership (e.g. in
the cabinet) without showing identity

The Deep Throat protocol

Assume PKI exists all have keys well-known

No trusted authorities

Efficient for large groups

Sender remains information theoretic anonymous within group

Sender can later prove he or she sent it

A set is defined by a set of keys <m1, Šmn>

A member signature is

x12(mod m1) XOR x22(mode m2) XOR Š.. ==h(m)

Proves group membership, sender can recreate later

Donald Beaver, CertCo Inc

Argues Micromint would work with DNA computing because volume would be
critical and Moore's law won't apply. How serious was he? I cannot say.
Exact Payments in Electronic Cash by Yiannis Tsiounis

CTO, co-founder of InternetCash Corp

Great outline and comparison of various Internet commerce mechanism. I want
to use the slides for my class. This is as good an overview of all the
mechanisms as I have seen, in the set-up section.

Selective Disclosure Envelopes presented by Rene Pevalta from Yale

His research focus is to develop a primitive that allows selective elements
of a message to be exposed by the owner

His goal is not unlike Incogno's

He uses the complexity of construction of VLSI logic assuming only NAND
gates. Minimizes as if for layout and then counts order of uncertainty by
delay (e.g count 1 for every gate delay in series)

Self-Protecting Pirates presented by Aggelog Kaiyias

A story about broadcast piracy

Suppose pirates are aware of tracing and that they cooperated and compared
outputs of data streams.

Put keys outside box so that only pirates can cooperate in the pirate network

Cooperatively determine data flow - distinct data results from attempts at
tracing - pirates detect all attempts at tracing



The first session was concerned with exmaining the single use credit card
numbers which are ap opular way fo addressing credit card fraud over the

Off-line generation of limited-use credit card numbers

by Aviel Rubin and Rebecca Wright was presented by Rebecca. They argue that
small changes in the infrastructure would allow much more security. Given
the 16 digit limit on credit card numbers, any attack on credit card
numbers can fairly easily succeed.

Audience: 13- 16 bit card digit change was a huge expense and ANY change in
infrastructure is massively expensive

Matt: benefit to the consumer is not only increase in security but also privacy

Shamir: the cost of infrastructure change is excessive? (I was in the back
and could not clearly hear his comments)

A Security Framework for Card-based systems presented by Yiannis Tsiounis

Offers a formal model of credit card and proposes cardsec product

Discusses Internet cash

With card present transaction in credit card numbers one cannot expand
space and create card numbers, and that currently the signature

In contrast MOTO transactions: (MOTO stands for mail order telephone order
it means card not present) have problems. They are forgeable, although the
credit card space is unexpandable the amount can be changed. Credit card
number can be used multiple times

The Formal ideal is that one cannot expand space and create card numbers,
and a PIN authenticates

This would make MOTO transactions still forgeable, at least unexpandable,
yet sill the amount can be changed. As long as one reuse requires PIN,
merchant can replay if merchant sees PIN.

Credit cards would comply with security definition IF the combination of
credit card number and PIN were long enough and always keep secret from

Thus the proposal for InterCash cards offers a Card id: 9 digits base 32,
with a Card security code: 11 digits base 32 and requires the use of a User
PIN: 4-8 chars. (Authentication & signature function: HMAC-SHA1)Total
security is 75 bits.

Paper includes cost analysis.

SecureClick: A Web Payment System with Disposable Credit Cards Numbers

Adi Shamir addressed the problem of developing a more secure payment system
for web.

Proposes a disposable credit card system. Soon it will be implemented and
used for 1//2 of all cards in Israel. He is not a founder of the company
but a security consultant. Discusses manner in which it addresses security
while still remaining feasible in the market. Practical stuff. Internet
Cash Payment Protocol

It offers the following:

*	security against parallel attacks
*	guarding against adversarial changes of payment information
*	immunity to replays
*	creation of secure channel between InternetCash and customer

Promises an update on the trial in Israel next year.

Panel on Internet Voting

Chair: Moti Young
Avi Rubin AT&T
Ed Gerck Safevote
Ron Rivest MIT

Ron Rivest

Edison patent 90846 for mechanical voting for Congress, never adopted
because it was "too fast" and did not fit the cultural realities (For
example the voting period sometimes allows horse trading. Constituent
service, capital improvements, etc. are traded in order to build
coalitions. While we may classify all of this as "pork", removing it is a
political problem and not something to be done via technical fiat. )

MIT and CalTech working on alternative voting technologies Secure platform
problem is very serious Buying and selling votes must be policed. Anonymous
political contributions are currently mited by size, electronic systems
should not enable political smurfing.

How can we bring financial crypt to bear on this problem? Absentee ballot
analogous to one-time credit card number Casting a vote like an electronic

Integrity is MOST IMPORTANT Auditing is incredibly important Lack of
uniform technology makes systemic fraud more difficult, heterogeneity is
critical Disabled voters are critical Absentee ballots are critical.

The security community is not ready at this time to enable on-line voting.

Ron's favorite: fill in bubbles with scanning at site

Ed Gerck, PhD

Ed is the CEO of SAFEVOTE. He spends time on cpsr-activists discussing
voting so any questions can easily find a good discussion forum there. Ed
thinks the technology is past ready.

Public votes must be: Anonymous, Secure, Reliable, Trusted

Acknowledges valid concerns that need to be addressed. Discusses the
situation in Brazil, with zero fraud and 100% logging Ed is very ready to
talk about his system. Check his site or engage him on CPSR activists email

VoteHere: Andy Neff

At the least should electronic voting should not be worse. It's going to
happen no matter what we do.

There are classes of electronic voting not to be confused: e-voting
includes digital voting, DRE machines, optical scanning machines

Louisiana voting fraud in 1999, where someone had altered the DRE machines

i-voting, in contrast, includes voting over the network; using generic

There have been military votes for president using a system provided by
Booze Allen. 84 votes at a cost of about 8,000,000. Used full PKI. After
authentication personnel selected choices, transmitted over an SSL. Created
a paper record.

Arguments Against I-voting: Digital Divide; Security; Loss of community

The events in the election of 2000 put perhaps too much light onto the
problem, so that changes may be made for the sake of quick change. Risk
that the better technology will be lost.

Successful trails in WA, Fl, OH, IA, VA, AK, AZ

Refused to do AZ Democratic vote or LA republican party because of lack of
security. Proposes that the problems in those system were the result of the
consultants hired and their lack of strict technical integrity.

Fundamental distinction in SafeVote. SafeVote is built on a subscription
model, in that the SafeVote people remain to operate the machines and
provide oversight. Safe Vote tries to address some of the human problems
with the voting system.

Avi Rubun, AT&T

Approach it as an engineering problem with the realities of the installed base.

Threat variables: election type, expertise skills, resources needed to
disrupt, motivation of potential attackers, disruption necessary to sway
the election, Internet voting, technical awareness.


*	-vote coercion
*	-vote sale
*	-vote solicitation (imagine banner add that says "DO Y OU LIKE A" then
click here to vote for A)

Technical issues:

*	Securing the platform
*	Securing communications channel
*	Assuring availability of network


*	Authentication in both directions
*	Maintaining equitable costs (no poll tax)

Wintel is installed. It's real it's flawed and it exists. Think
Backorifice. It is totally inadequate as a voting machine The Internet is
totally inadequate as a network. The ratio of cost of disruption/to result
of disruption is far too low.

Bob Hettinga (sp?) wants to talk about finance and voting not public voting
because this political cryptography no financial cryptography

Matt Blaze says fraud and error is quite possible but the difficulty of
accomplishing fraud is proportional to the amount of fraud you can perform
however there are catastrophic failures in networked systems. We do not
need to accept the idea that Internet voting is what we are going to have.
Our role is not to make it happen but rather to prevent it from happen.

I made a very strong statement. Noting that some of the factual statements
were wrong. For example, Andy Neff said that there was a divide in plumbing
and that was fine. In fact the right was passionately opposed to publicly
funded water systems. Cholera epidemics finally motivated widespread
investment in public water supplies. I accused him of political autism. My
point was meant to be that the distribution of risk is a voting system is
deeply social and political. While those debates about risk distribution
should be informed by technical understanding, making technical decisions
about risk distribution is fundamentally political and social. (My comments
were scathing and I meant them to be far less so. I hate it when I do that.
Andy Neff is a committed intelligent ethical person. But still I think the
problem of specifications is an (admittedly irrational) political one, not
a strictly scientific one. Having technical expertise in a democracy can be
frustrating because people have the right to be wrong.)

The discussion was so passionate that it was determined that the other
panel will meet after lunch.

Q: Do we understand the systems that do exist? Is it that the nature of
paper itself that gives us a false sense of confidence? Can we inspect a
system? Do we understand all modes of failures? Does having four people
look at the number make it right?

A speaker said that technical people struggling to do the right thing
should not be scathed.

Stefen Brands has put forward a proposal for shared key systems. He
proposes this would provide anonymity but certification for voting.

Andy Neff offers threshold privacy, where the VoteHere system offers
threshold voting.

I missed the post-lunch session.


The first paper of the last day began as I was getting my tea, so I do not
know the name of the presenter. Monotone Signatures is by David Naccache,
David Pointcheval, Christophe Tymen

Predicates are monotone if for any input x if Pn(x)=>P n-1(x)=>Š=>P1(x)

Monotone signatures requires a ket generation algorithm, a signing
algorithm, a list n of monotone verifying algorithms. THis offers the
following properties: completeness; soundness (no existential forgery)
Indistinguishability missing public keys should not change distribution of
the t+1 certificate

In most systems the idea is that keys are kept and that revocation is an
unusual event. In this system the possibility/reality of fraud is addressed
in the design by depending on a predicate and key generating function as
well as creating messages such that the verifier can determine on which
dates they may be valid but the attacker cannot.

Properties of Schnorr: to prevent n corruptions requires n random values to
prevent n corruptions. And clearly this is incredibly expensive.
Okamoto-Schnorr improves on this cost. MSS offers improvements by hidign
relationships between the key generation and signing algorithm.

Rivest suggests that this is similar to the revealed predicate in MicroMint.

Shamir says signature size has an upper bound of k.

A: only verifier and signer need to know k, it is hidden

The Power of RSA Inversion oracles and the security of Chaum's RSA-Based
Blind Signature Scheme was presented by C. Namprempre (who goes by Miao)

Critical topics in coin creation: unforgeability and anonymity

RSA is secure but other than noting that it is a one-way function the basis
of RSA security in a transactional system is not well understood. In order
to evaluate digital signature schemes it is important Building on the work
of one-more forgery where forger can get q signatures and is successful is
forger can create q+1 coins, e.g. forger is assumed to have access to the

RSA is homomorphic E(a)*E(b) = E(ab) thus coins must be constructed to
remove this homomorphism Chaum's blind signature were quickly reviewed in
her talk, necessary for most audiences.

The problem the paper is trying to shop is that the Chosen Target Inversion
Problem is easy to solve without an underlying proof that RSA is np
complete. If Chaum's signature protocol is forger then the CTI problem is
easy to solve. The CTI problem can be solved in polynomical time. They have
proven the unforgability of Chaum's scheme. RSA inversion problem such as
CTI problems capture new issues of RSA and are of independent interests.

No questions.

Optimistic Fair-Exchange with Transparent Signature Recovery

Presented by a colleague, neither author could make the conference.

Transparent means that whatever occurs the participants at the end will
have correct signatures. An example of fairness: airline ticket is provided
bit-by-bit as is payment.

Trusted Third Party should be used only during set-up and dispute
resolution. TTP can either give affidavit and can be transparent.
(recommends work of Asokan).

Non-english exchange with Shamir. For my purposes, an encrypted exchange.

The transaction is as follows:

P-> C encrypted item and providers commitment
C->P client's committed signature on the item's description
P->C item and provider's final signature on item's description
C->P client's final signature on the item's description

TTP will produce final signatures from the committed signature and will
transmit item to client or payment to provider

Maintains that this provide a high level of atomicity.

Very similar in goals to the work on NetBill by Sirbu, Tygar, etc. The
difference between them may be in efficiency. NetBill requires one DES and
two public key encryption operations. NetBill requires no operations but
read on case of default. This seems to have traded efficiency for grace in
design. However, it is more efficient than a zero knowledge protocol.
Substitutes computation for communication. Assumes identity of consumer for
purposes of dispute resolution.

I believe that anonymity is sacrificed for dispute resolution. However, the
authors were not there so they could not address my concerns. My big thing
in e-commerce was anonymous rollback and a system which would not allow
framing of consumers even if all security parameters failed. It's at
http://www.ljean.net/acd/acd.html in an old form a newer one should soon be
at http://www.ljean.net/tse.html

Quick Auction review common to two following papers:

English: buyers bid up

Dutch: sellers bid down

Sealed bid auctions provide privacy of bidders

Vickrey Auction:

Sealed bid has first price and second price auctions. First price is M=0,
second price is M=1

M items, n>M bidders. Bids (mn, m n-1, Š.mjŠm0) winning price is mm and all
winners pay mj. but only parties ' (n, j+1) win where M=n-(j+1)

(M+1)st Price Auction
presented by Hiroaki Kikuchi who offered his email as Kikn {AT} p.u-tokai.ac.jp

Identities and specific bids are usually exposed even in a M>0 auction.
This information is not necessary, and can be hidden for all auctions.
Hiroaki offers anonymous sealed-bid mechanism.

Threat models: dishonest bidders. Bidders can conspire to control winning
prices. Nonrepudiation is required to prevent bidder conspiracy.
Auctioneer: leaks information Blackmail: forced bidder conspiracy

Literature review. Work has been done on Dutch auctions and distributed
auctioneers/ trust in auctioneers. Also oblivious evaluator.

Here focus on distributed approaches.

Idea: homomorphism of sum of polynomial. Degree of polynomial represents
bid. Calculate bid of largest degree. Bidders calculate shares of
polynomial (like secret sharing) and each auctioneer has some integer x.

Using verifiable secret sharing bidders can detect cheating by auctioneers.
Auctioneers can prove correctness of results. An additional polynomial
identifies winners. The prices offered by the individual bidders are never
known but the price paid by the winners is known ex. Since this works on
Vickrey auction this works on all auctions.

Sorry, couldn't hear the question. Still sitting in back next to my outlet.

Non-interactive Private Auctions presented by Oliver Baudron

Very good overview of previous approaches to auction approaches previously
published. Bids are encrypted via predicates, and the maximizes for each
predicate. Bit-comparison of predicates. Winner receives zero as predicate
comparisons. Winner proves submission of highest bid.

For Vickery auctions the protocol is run each time until the jth winner is
reached. More expensive than previous protocol and exposes more
information. For Dutch and English auctions an innovative design.

I am definitely coming to this conference next year.
R. A. Hettinga <mailto: rah {AT} ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

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