December 2003 - cypherpunks-legacy

17 Dec '03

JWS writes: >Well here are the answers that I'm working with in my model: >First, what you set up has to work off-line. At the same time, validation, >by its very nature, is a process that can only be accomplished online. The >part of my code that I am in the middle of right now (and strugling with) >uses a distributed dynamic hashing scheme (with some attempt at periodic >space minimalization [this is what is making it tricky]) whereby information >is recorded in the public system such that if one part of a bill is used >twice, the cheat's identity is revealed. >[...] >For types of small transactions that will be executed frequently, the >best idea is to establish accounts. In my system, when ever an agent >enters somebody else's computer, it gives the local wizard (the agent >with the final say on computational cycles, storage space, and >communications) a deposit which neither the agent nor the wizard can >cash without agreement by both [do public validation and recording >but hold off on the last steps which allow the wizard to use the money]. >The money is thus recorded globally as having been spoken for. Then, for >all transactions on the local machine, the agent simply uses its local >account, just as anybody would in a much simpler bank-based protocol, >like the ones we have now. This seems like a good approach for a lot of cases. You end up having three classes of transactions: small, medium, and large, with slightly different strategies for each. For large, you do on-line checking; for medium, you detect double-spending after the fact and use crypto to find his identity; and for small you set up an account and dip into that a bit at a time. I am curious about whether you are focussing more on some size range in your plans. One problem I still see is the small transaction where you don't tend to use the same provider again and again. On the net there are a few sites (well, quite a few, I suppose) which are heavily used, but there are a lot of places I might like to just browse through. Paying a penny per site isn't going to bother me much, but if I have to set up an account for each one ahead of time I'm probably not going to bother. So I still think there are problems with the fractional-cent-per-web-site model which I have been hearing about. >I don't agree on this point. I prefer license based e-cash which is modified >on each transaction (and unfortunatelly gets slightly bigger -- the downside >of this method). If we're going to make the conversion to ecash, we might >as well make it as powerful as mathematics will allow. Is this an approach where you determine to whom you will be sending the cash, then make it into a "check" which can only be spent by that recipient? Doesn't that require the bank's (cash issuer's) help? Or is this something else? Hal

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e$: a long enough lever...
by rah＠shipwright.com 17 Dec '03

17 Dec '03

> >Not true. Teleflora is a company that sells automatic processing software > and also will be a front-end to credit card companies. You pay 'em, you > get your merchant ID and go, and start getting checks every so often. This is kind of like the "internet drive-up window" ATM gateway idea my cronies and I were throwing around. The funds transfer happens between the vendor and buyer's banks through an ATM/internet gate, probably owned by a bank. The WWW/secure mosaic "wallets" and "cash registers" would be given away. >I see a lot of great ideas for e$ out there, but I think they all suffer > from a central fault: there's no easy transition from the way people do > business in the real world to an e$ model. IMO, you've got to base a system > in the way people are used to working and make a gentle transition, or > it's simply going to fail purely on the learning curve. I keep insisting that an ATM gate offer the option of ecash in the transaction, with us as the underwriter of the cash, even though my more "practical" associates offered your rationale for not doing it... They seem to be winning the argument at the moment. ;-). Cheers, Bob Hettinga ----------------- Robert Hettinga (rah(a)shipwright.com) "There is no difference between someone Shipwright Development Corporation who eats too little and sees Heaven and 44 Farquhar Street someone who drinks too much and sees Boston, MA 02331 USA snakes." -- Bertrand Russell (617) 323-7923

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Re: Small transaction amounts
by fnerd＠smds.com 17 Dec '03

17 Dec '03

Eric speaks of the two kinds of electronic money systems-- closed ones where crypto doesn't have to be done because the system guarantees security, and open ones where crypto has to be used. > The closure, however, of these systems means that they don't scale. > That's bad, fatal, in fact. That doesn't mean that closed systems > will disappear, merely that the largest systems must be open. > > What is desirable economically is that the boundary between closed > clearance systems and open clearance systems be porous enough that the > market can find an optimal distribution between the two varieties. Right...I think. What has to scale is the "semantics of money." Within a small area ("box"), security is guaranteed by how the enclosing system works, and over a larger area it's done by crypto (*). But for the programs, the difference is transparent, except for a cost that resembles communications cost. (*) There's also an issue of, "Can that box over there guarantee me that I can run programs securely within it?" There are ways to do this with tamperproof boxes and such. Or looser ways to do it with reputations. -fnerd - - - - - - - - - - - - - - - nutritional information per serving: less than one (1) bit -----BEGIN PGP SIGNATURE----- Version: 2.3a aKxB8nktcBAeQHabQP/d7yhWgpGZBIoIqII8cY9nG55HYHgvt3niQCVAgUBLMs3K ui6XaCZmKH68fOWYYySKAzPkXyfYKnOlzsIjp2tPEot1Q5A3/n54PBKrUDN9tHVz 3Ch466q9EKUuDulTU6OLsilzmRvQJn0EJhzd4pht6hSnC1R3seYNhUYhoJViCcCG sRjLQs4iVVM= =9wqs -----END PGP SIGNATURE-----

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Re: "Key Escrow" --- the very idea
by wcs＠anchor.ho.att.com 17 Dec '03

17 Dec '03

Carl Ellison, who should know better (:-), writes: > if you really want to propose an escrow system we can live with, > I would demand that it include: Arrrgh! I'll try not to flame much here, but this is *wrong*! Please don't buy in to the government's claims of legitimacy for this nonsense merely because they've backed down on the less practical implementations of their abusinve proposal! First of all, _escrow_ systems are something that two contracting parties use when they want a trusted third party to perform a service for them. Holding deposits in real estate transactions is a classic example. Built-in wiretaps are *not* escrow, unless the government is a party to your contract. As somebody on the list once said, just because the Mafia call themselves "businessmen" doesn't make them legitimate; calling extorted wiretaps "escrow" doesn't make them a service. The government has no business making me get their permission to talk to anybody about anything in any language I choose, and they have no business insisting I buy "communication protection service" from some of their friends to do it, any more than the aforenamed "businessmen" have any business insisting I buy "fire insurance" from *them*. If you want to talk about escrow systems, the proper contexts are things like contract fulfillment between anonymous parties... Meanwhile, back to conditions for built-in phone wiretap systems: > 1. unambiguous ID of the person being tapped in the LEAF-equivalent No! I agree that having the government prove your phone was used for a given conversation that you weren't part of is bad, but the only way to have unambiguous ID for wiretappees is to have unambiguous ID for everybody - I certainly don't want to have to insert my National Real American ID Card into a phone to make a call, or into my computer to send email, and in case people start noticing that they can't make phone calls after their wallets are stolen, I don't want to have to wave my arm-tattoo over the scanner either. (Ok, I said I'd *try* not to flame :-) > 2. multiple escrow agencies, at least one of which is the NSA HQ > (for its superior physical security) They're the *last* people I want involved with routine communications between ordinary people. They're an agency that should probably be abolished, but at most they should stick to providing secure communications for the military; I don't want military police agencies or even Federal civilian police agencies getting involved in civil commerce, (especially when they're doing it to find new businesses now that we don't have Commies to kick around any more.) I shouldn't need *anybody's* permission to have a private conversation with anybody, but least of all a secret organization that classifies their activities rather than working out in the open. > 3. watchdogs as escrow agents (e.g., ACLU, Rep & Dem parties, CPSR, > EFF, NYTimes, ...) with authorization to look for abuses of > authority and to refuse to release keys in such cases and to > publicize such cases as well as bringing them to the attention > of law enforcement for prosecution. Realistically, if the government starts allowing non-government agencies as keymasters, it'll probably be banks or phone companies, since they're large cooperative subpoenable organizations that are involved in the communications the government most cares about wiretapping, and they're hard to avoid since they're providing your services. In particular, it'll help set precedents. Bad ones. I'd also worry about the effects on a watchdog group of taking government money for helping the government wiretap people. Wiretap keymastering is likely to be an expensive activity, if done competently, and involves major questions of liabilty. What happens when the government says to your group that they'll cut your funding by $1Million if you don't keep this one quiet? Even if you're honest enough for that not to work, what about the moral effects of being on the government's side in a court case (as keymaster) when you used to be the group that defended the Steve Jacksons and Craig Neidorfs? > 4. user-generated escrow keys, to reduce the chance of anyone having a > backdoor way to get the whole escrow key database. That's a minor technical detail :-) It's also quite possible, and the all-software wiretap version that Dorothy Denning and friends are talking about supports it just fine. A more important detail would be to use genuinely separate master keys instead of one master key split into multiple parts for the keymasters by the trusted NSA, as in the current Clipper system. Bill # Bill Stewart AT&T Global Information Solutions, aka NCR Corp # 6870 Koll Center Parkway, Pleasanton CA, 94566 Phone 1-510-484-6204 fax-6399 # email bill.stewart(a)pleasantonca.ncr.com billstewart(a)attmail.com # ViaCrypt PGP Key IDs 384/C2AFCD 1024/9D6465

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Re: clipper and export
by Jonathan Rochkind 17 Dec '03

17 Dec '03

> > Is anyone else distrubed by the way that encryption export policy > and the > clipper chip seem to be linked {in administration policy, > and in the > press? > > Well, we helped made this connection happen! We, in the sense of the > overall letter-writing campaign...all those exhortations for us to > please get the Cantwell Bill moved along, those daily updates, etc. > EFF, CPSR, EPIC, and messages here on Cypherpunks and in other fora > (or forums). WEell, sure. And we all know that there _is_ actually a connection; liberalized export policies will make it hard for them to impose clipper as a standard without prohibiting other crypto. And I would assume they know this, and that's why {they wont' do it. And I would assume the privacy-freaks know this too, and that's why they support liberalizing export. But my concern is that no one seems to bring up the point that this is really _bad_ reasons for determining national policy regarding encryption export. The legislation that allows them to restrict export only does so on the basis of national security. _Not_ on the basis of "it'll make it easier to implement our domestic encryption policy". Everyone involved with the debate extensively realizes that this _is_ the basis on which the administration is determining export policy. But there seems to be no outcry abou{t it. I haven't even seen it brought up in any media, digital or print. And this is what I see is a problem. {Not only is {the government messing around with us here, but we seem to expect it so much that we dont' even bother to point it out or complain about it. I think we should be doing that. The public debate about export restriction should center on "is it actually a national security risk, and if it isn't, why not liberalize things?" Instead, there really is no debate, it's ob{vious that actual national security isn't even an issue in the Administration decision to {keep encryption export restrictions tight, and no one seems to think this is a problem! That's what I find disturbing.

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UNRELATED ABUSE OF BANDWIDTH
by Sandy Sandfort 17 Dec '03

17 Dec '03

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ SANDY SANDFORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C'punks, This is not a crypto post. It is a personal request, primarily directed to Cypherpunks in the San Jose area. It also skates perilously close to having "commercial" content. Please tune out now if any of this bothers you. My son-in-law wants to barter services in exchange for a good second-hand computer. He is an RC (Radio Controlled) airplane flight instructor. He can also offer other RC related services. His preference would be a Mac, but he would consider a PC clone. It doesn't have to be the most up-to-date model. He wants to use it for business applications, CAD and video editing. I also want him to have a modem so he and I can keep in touch. (I guess the crypto tie-in is that I'll expect him to use PGP.) If you are interested in the swap, send me e-mail, or call him directly. His name and number are: Walter Berggren 408-971-0110 Thanks for reading this message, S a n d y ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

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by the way NSA...
by John Young 17 Dec '03

17 Dec '03

This amplifies Perry's post on the annual intelligence black budget of $28 billion. NY Times, November 25, 1993: . . . the black budget is estimated to be nearly $28 billion this year. The money is hidden under falsified line items in the Pentagon's budget. The secret budget finances the National Security Agency, which conducts electronic eavesdropping; the National Reconnaissance Office, which builds spy satellites; the Central Intelligence Agency, and a host of military intelligence activities. . . . the CIA spends less than 15 per cent of the total espionage budget. Pentagon agencies spend almost all the rest. At the CIA, Mr. Woolsey voiced doubts about disclosing the sum, saying it would lead to a debate over its constituent elements. End quotes. And there is more than this budget covers. For all kinds of intelligence costs (and crypto business opportunities) see Jeffrey T. Richelson's The US Intelligence Community, 1989, ISBN 0-88730-226-2.

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EFF Analysis of Vice-President Gore's Letter on Cryptography Policy
by Stanton McCandlish 17 Dec '03

17 Dec '03

EFF Analysis of Vice-President Gore's Letter on Cryptography Policy ------------------------------------------------------------------- July 22, 1994 Two days ago, Vice-President Al Gore signaled a major setback in the Administration's Clipper program, and a willingness to engage in serious negotiations leading to a comprehensive new policy on digital privacy and security. Many questions remain about the future, but one thing is certain: Clipper is a dead end, and those of us who are concerned about digital privacy have won a new opportunity to shape a better policy. The Vice-President's letter to Rep. Maria Cantwell (D-WA) made it clear that while Clipper might have a small place in the telephone security market, it has no future in the digital world. "...[T]he Clipper Chip is an approved federal standard for telephone communications and not for computer networks and video networks. For that reason, we are working with industry to investigate other technologies for those applications.... We welcome the opportunity to work with industry to design a more versatile, less expensive system. Such a key escrow system would be implementable in software, firmware, hardware, or any combination thereof, would not rely upon a classified algorithm, would be voluntary, and would be exportable." Clipper does not meet most of these criteria, so, according to the Vice- President, it is a dead end. END OF THE LINE FOR CLIPPER -- LONG-RUN EFFORT TO DRIVE MARKET WILL FAIL The premise of the Clipper program was that the government could drive the market toward use of encryption products which incorporated government-based key escrow agents. A series of subtle and not so subtle government actions would encourage private citizens to use this technology, thus preserving law enforcement access to encrypted communications. Clipper was originally announced as the first element of a family of hardware-based, government key escrow encryption devices that would meet security needs for both voice and data communications on into the future. Clipper itself was purely a voice and low-speed data product, but other members of the Skipjack family, including Tessera and Capstone, were to be compatible with Clipper and were intended to lead the way from escrowed encryption in voice to escrowed encryption for data. Plans are already announced, in fact, to use Tessera and Capstone in large government email networks. At the time, the hope was that government use of this technology would push private sector users toward key escrow systems as well. Now, the announcement that the Administration is re-thinking plans for data encryption standards leaves Clipper a stranded technology. No one wants to buy, or worse yet, standardize on, technology which has no upgrade path. As a long-run effort to force the market toward government-escrowed encryption standards, Clipper is a failure. WE STILL MUST WORK FOR VOLUNTARY, OPEN, EXPORTABLE STANDARDS The fight for privacy and security in digital media is by no means over. Though the Administration has backed away from Clipper, and expressed willingness to talk about other solutions, we are pursuing serious progress on the following issues: * Improved telephone encryption standards For the reasons listed by the Vice-President, in addition to the inherent problems of making copies of all your keys available, Clipper is a poor choice for telephone encryption. Industry should develop a standard for truly secure and private telephones, make them available from multiple manufacturers worldwide, and make them interoperate securely with audio conferencing software on multimedia PC's. * Truly voluntary standards Any cryptographic standard adopted by the government for private sector use must be truly voluntary. Voluntary means, to us, that there are statutory guarantees that no citizen will be required or pressured into using the standard for communications with the government, or with others. No government benefits, services, or programs should be conditioned on use of a particular standard, especially if it involves government or private key escrow. * Open standards Standards chosen must be developed in an open, public process, free from classified algorithms. The worldwide independent technical community must be able to create and evaluate draft standards, without restriction or government interference, and without any limits on full participation by the international cryptographic community. * No government escrow systems Any civilian encryption standard which involves government getting copies of all the keys poses grave threats to privacy and civil liberties, and is not acceptable in a free society. * Liberalization of export controls Lifting export controls on cryptography will make the benefits of strong cryptography widely available to our own citizens. U.S. hardware, software and consumer electronics manufacturers will build encryption into affordable products once they are given access to a global marketplace. Today's widespread availability of "raw" cryptographic technology both inside and outside the United States shows that the technology will always be available to "bad guys". The real question is whether our policies will allow encryption to be built into the fabric of our national and international infrastructure, to provide significantly increased individual privacy, improved financial privacy, increased financial security, enhanced freedom of association, increased individual control over identity, improved security and integrity of documents, contracts, and licenses, reduced fraud and counterfeiting, the creation of significant new markets for buying and selling of intellectual property, and a lessened ability to detect and prosecute victimless crimes. These benefits are not free, however. EFF does recognize that new communications technologies pose real challenges to the work of law enforcement. Just as the automobile, the airplane, and even the telephone created new opportunities for criminal activity, and new difficulties for law enforcement, encryption technology will certainly require changes in traditional investigative techniques. We also recognize that encryption will prevent many of the online crimes that will likely occur without it. We further believe that these technologies will create new investigative tools for law enforcement, even as they obsolete old ones. Entering this new environment, private industry, law enforcement, and private citizens must work together to balance the requirements of both liberty and security. Finally, the export controls used today to attempt to control this technology are probably not Constitutional under the First Amendment; if the problems of uncontrolled export are too great, a means of control must be found which does not restrict free expression. CONGRESSIONAL LEADERSHIP TOWARD COMPREHENSIVE POLICY FRAMEWORK IS CRITICAL The efforts of Congresswoman Maria Cantwell, Senator Patrick Leahy, and other members of Congress, show that comprehensive policies on privacy, security and competitiveness in digital communication technologies can only be achieved with the active involvement of Congress. Unilateral policy efforts by the Executive branch, such as Clipper and misguided export control policies, will not serve the broad interests of American citizens and businesses. So, we are pleased to see that the Vice-President has pledged to work with the Congress and the private sector in shaping a forward-looking policy. We see the Vice-President's letter to Congresswoman Cantwell as an important opening for dialogue on these issues. The principles of voluntariness and open standards announced in the Vice- President's letter, as well as those mentioned here, must be incorporated into legislation. We believe that under the leadership of Senator Leahy, Reps. Cantwell, Valentine, Brooks and others, this will be possible in the next congress. EFF is eager to work with the Congress, the Administration, along with other private sector organizations to help formulate a new policy. EFF is also pleased to be part of the team of grass roots activism, industry lobbying, and public interest advocacy which has yielded real progress on these issues. FOR MORE INFORMATION CONTACT: Jerry Berman, Executive Director <jberman(a)eff.org> Daniel J. Weitzner, Deputy Policy Director <djw(a)eff.org> For the full text of the Gore/Cantwell letter, see: ftp.eff.org, /pub/Alerts/gore_clipper_retreat_cantwell_072094.letter gopher.eff.org, 1/Alerts, gore_clipper_retreat_cantwell_072094.letter http://www.eff.org/pub/Alerts/gore_clipper_retreat_cantwell_072094.letter

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Gore's "new and improved" key escrow proposal
by mpjohnso＠nyx10.cs.du.edu 17 Dec '03

17 Dec '03

Just think how easy it would be to comply with software key escrow requirements: imagine a new PGP option -- +encrypt_to_escrow_agents=on The escrow agent's PGP public key could be shipped with every copy of PGP... naturally, every PGP user will be required by law not to override this option if the Vice President gets his way. --- sound of tongue being removed from cheek --- I have tried to think of a positive use for key escrow. The only thing that I have come up with so far is kind of like having local key escrow within one company, or something like that. Kind of like having a master key that fits all the offices in one wing of a building, or something like that. That could be good in some business uses, provided you could pick your own trusted master key holder. I don't think that is what Al Gore has in mind.

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Re: by the way...
by Claborne, Chris 17 Dec '03

17 Dec '03

Perry writes: << For those who believe "the NSA can do ANYTHING" or some such, an article in the New York Times claims the annual black budget now seems to be hovering around $28 Billion per year, for ALL secret government work. >> That's all the money that you KNOW about :) 2 -- C --

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