1. TM MilliCent Scrip, Security and Secrets TM Dr. Mark S. Manasse DIGITAL Systems Research Center, Palo Alto http://www.millicent.digital.com/

2. TM Scrip  Vendor-specific currency –not quite cash, account, bearer certificate,...  Can represent money, access rights, points, etc.  Generated by either brokers or vendors  Based on secrets and cryptography Like a software pre-paid phone card, with PIN

3. TM Cryptography in MilliCent  A one-way hash function has the properties: –one-way:  given hash(S), it is hard to find S –collision-free:  given S and hash(S), it is hard to find T such that S  T  and  hash(S) = hash(T)  MD5 or HMAC-MD5 Hash functions

4. TM Cryptography in MilliCent  Suppose that A and B share a secret S  When A wants to communicate M to B: –for integrity and authenticity  A can send hash(M,S) together with M  B can check hash(M,S) –for secrecy  A can generate and send a random number N, and hash(N,S) XOR M, instead of M  only A and B can recover M Applications of one-way hash functions

5. TM Hash Master scrip secret 5 Stamp Vendor Value ID# Cust ID# Expiry Props Customer Master scrip secret 4 Master scrip secret 5 Master scrip secret 6 Scrip stamp generation (at vendor or broker)

6. TM Hash Master scrip secret 5 Stamp Vendor Value ID# Cust ID# Expiry Props Customer Master scrip secret 4 Master scrip secret 5 Master scrip secret 6 Stamp Compare Scrip stamp validation (at vendor)

7. TM RequestScripCustomer secret Hash Request stamp Request stamp computation (at customer and vendor)

8. TM Master customer secret 2 Master customer secret 3 Master customer secret 4 Master customer secret 3 Customer secret Hash Vendor Value ID# Cust ID# Expiry Props Cust ID# Customer secret computation (at broker or vendor)

9. TM Advantages of Scrip  Double-spending is easy to detect –It requires only a local lookup (using a unique sequence number) –In contrast, other kinds of currency may require a round-trip to a central authority  Forgery is hard –Scrip includes a stamp  Scrip cannot be stolen –Payment is cryptographically tied to request Within MilliCent...

10. TM Advantages of Scrip  Payment for services is reliable  Cheating is hard –For customers –For interlopers and financial agents  Being a vendor is easy –The vendor bills the broker, not the customer –Overhead is small  Both large and small vendors are viable For vendors...

11. TM Advantages of Scrip  Billing is verifiable –Fraud is detectable –The customer has some control of financial exposure  System preserves some privacy –No one knows everything you buy  Commerce is easy –A web browser can handle payments –The customer may set policy and trust limits For users...

12. TM Digital Equipment Corporation © 1997