Hmm.. This is interesting indeed. It is a 32-round cipher operating on a 64-bit block. It has an 80-bit key with a 16-bit cryptographic checkword. This seems a lot like a certain hardware-based encryption system some TLA spooks were pushing about a year ago. If this isn't Skipjack, someone sure went to a lot of trouble to make it look like skipjack. It's also possible that it is an early development version of what later became Skipjack/Clipper. It is dated February 1989 and July 1991, which would be consistent with NSA's claim that they had been working on Skipjack for about 5 years. It also mentions a "S-2" revision. It'd be interesting to try to see if it will interoperate with a real clipper chip, but I wouldn't bet on it. Hal Finney noticed that the coding style seems sloppy or amateurish. This is probably just an attempt by the programmer to hide his tracks. The RC4 stuff also had unnecessary operations in it, presumably for the same reason. Hal also comments on the use of XOR instead of bit permutations as in DES, and the use of 8-bit table sizes, which would make a software implementation easier. This is odd, considering that the algorithm purports to be designed for hardware. However, NSA did say that part of the clipper algorithm was in software, which was designed to be erased if the chip was tampered with...