Lecture 12 E-Commerce and Digital Cash. As communication technologies, such as the Internet and wireless networks, have advanced, new avenues of commerce.

Lecture 12 E-Commerce and Digital Cash

As communication technologies, such as the Internet and wireless networks, have advanced, new avenues of commerce have become available. This great potential to reach more customers has led to great potential for theft and fraud. Transmitting credit card and purchase information over nonprotected channels can lead to unwanted parties invading customer privacy and stealing vital credit information. Securing the information necessary to conduct electronic commerce is therefore very important.

We look at three examples of how cryptography can be used in electronic business transactions. We use the signatures with additional functionality. The mechanisms described in this lecture provide functionality beyond authentication and non-repudiation. In most instances, they combine a basic digital signature scheme with a specific protocol to achieve additional features which the basic method does not provide.

Outline

Secure Electronic Transaction Undeniable Signature Digital Cash

1 Secure Electronic Transaction Every time someone places an order in

an electronic transaction over the internet. These data must be protected from unwanted eavesdroppers in order to ensure the customer’s privacy and prevent credit fraud.

1.1 Requirements

protected. bemust numbers card

credit assuch n informatioaccount Sensitive : (4)

possible. as secure as

kept be shouldon transactia of details The : (3)

altered. becannot nsinstructiopayment

and orders purchase assuch Documents : (2)

forged. becannot signatures and edimpersonat

becannot on transactiain tsParticipan : (1)

Security

Privacy

Integrity

tyAuthentici

1.2 SET Protocol

In 1996, the credit card companies MasterCard and Visa called for the establishment of standards for electronic commerce. The result, whose development involved several companies, is called the SET. It starts with the existing credit card system and allows people to use it securely over open channels. The SET protocol is fairly complex, involving many technique details. In the following, we’ll discuss one aspect of the whole protocol, namely the use of dual signature.

1.2.1 ElementsParticipantsBankCardholderMerchantCardholder’s two pieces of informationGSO=goods and services order, which consists

of the cardholder’s and merchant’s names, the quantities of each item ordered, the prices, etc.

PI=Payment Instructions, including the merchant’s name, the credit card number, the total price, etc.

1.2.2 Problem

The bank does not need to know what the customer is ordering, and for security reasons the merchant should not know the card number. However, these two pieces of information need to be linked in some way. Otherwise, the merchant could attach the payment information to another order.

1.2.3 Transaction Scheme

The system uses a public hash function H. A public key algorithm RSA is used, and the cardholder, the merchant, and the bank have their own public and private keys. Let EC, EM, and EB denote the encryption functions for the cardholder, the merchant, and the bank , and let DC, DM, and DB be the decryption functions .

1.2.3 Transaction Scheme (Continued)

merchant. the to)( and , ,),( Send (4)

. the

is This ).( computingby Sign )3(

).||(

result theofhash thecompute then ,

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.))((

and ))(( Calculate (1)

:following thedo should

. using

merchant for the pays cardholder The :SUMMARY

schemen Transactio

PIEPIMDDSGSOE

POMDDDSPOMD

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POMDGSOMD

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PIEH

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BM

C

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M

Signature Dual

cardholder The

1 Algorithm


bank. the to)( and ,, Send (4)

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. signature

s'cardholder the verifiedhasmerchant then theequal, are

theyIf ).( and )))((||( Calculate (2)

. equal should which , ))(( Calculate (1)


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B

MM

CM

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merchant The


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)}(

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number. card

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PIEB

Comment.

2 Undeniable Signature Normal digital signatures can be copied exactly.

Sometimes this property is useful, as in the dissemination of public announcements. Other times it could be a problem. Imagine a digitally signed personal or business letter. If many copies of that document were floating around, each of which could be verified by anyone, this could lead to embarrassment or blackmail. The best solution is a digital signature that can be proven valid, but that the recipient cannot show to a third party without the signer’s consent.

2.1 Scenarios for Undeniable Signature

. ofactivity fraudulent the traceeasier to be also

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advantage marketing but the signatureown its with package

thesigning-re from prevent not does scenario this

course, Of . ofn cooperatio he without tsoftware the

ofty authentici e verify th tounable is .party third

a it to resell and package thisof copies make todecides

who,entity it to sells and package thesigns package.

software a creates n corporatio large some Suppose (1)

B

BA

B

A

C C

BA

A

2.1 Scenarios for Undeniable Signature (Continued)

process.ion verificatsignature the

in t involvemendirect s'ithout facility w theused that

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signature, undeniablean uses If granted. is access before

document date and timeasign torequires room.box

deposit -safety a be example,for might, area secured

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a toaccessgain to wishescustomer) (the Entity (2)

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2.2 Basic Idea

this.confirms (4)

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number random theusingn calculatio a does (3)

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signature. a with presents (1)

B

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2.2 Basic Idea (Continued)

herself. with

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Explain.

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2.3 Chaum-Antwerpen Scheme

. iskey private s' ); , ,( iskey public s' (4)

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(2.1). step togo then ) (mod 1 If (2.2)

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prime. a also is where12 prime random aSelect (1)

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key. public

ingcorrespond andkey private a selectsentity each :SUMMARY

for generationKey

)/1(

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3 Algorithm2 Algorithm

2.3 Chaum-Antwerpen Scheme (Continued)

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order of subgroup the tobelonging message a signs :SUMMARY

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ion.participat s'

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3 Algorithm

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Comment. Security


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3 Algorithm

).(ContinuedComment Security

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forgery. a is signature ewhether th

or , using s signature valida disavow toattempting

is signer he whether tdetermines scheme this:SUMMARY

schemeAntwerpen -Chaumfor scheme Disavowal

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3 Algorithm

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Comment. Security

2.4 Further Consideration

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signature thetecan valida He copy. legal a buys (1)

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2.4 Further Consideration (Continued)

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3 Digital Cash

Cash is a problem. It’s annoying to carry, it spreads germs, and people can steal it from you. Checks and credit cards have reduced the amount of physical cash flowing through society, but the complete elimination of cash is virtually impossible. It'll never happen; drug dealers and politicians would never stand for it. Checks and credit cards have an audit trail; you can’t hide to whom you gave money.

Checks and credit cards allow people to invade your privacy to a degree never before imagined. You might never stand for the police following you your entire life, but the police can watch your financial transactions. They can see where you buy your gas, where you buy your food, who you call on the telephone—all without leaving their computer terminals. People need a way to protect their anonymity in order to protect their privacy.

A great social need exists for this kind of thing. With the growing use of the Internet for commercial transactions, there is more call for network-based privacy and anonymity in business. (There are good reasons people are reluctant to send their credit card numbers over the Internet.)

3.1 Scenarios for Digital Cash

Lobbyist Alice can transfer digital cash to congress critter Bob so that newspaper reporter Eve does not know Alice's identity. Bob can then deposit that electronic money into his bank account, even though the bank has no idea who Alice is. But if Alice tries to buy cocaine with the same piece of digital cash she used to bribe Bob, she will be detected by the bank. And if Bob tries to deposit the same piece of digital cash into two different accounts, he will be detected—but Alice will remain anonymous. Sometimes this is called anonymous digital cash.

3.2 Requirements for Digital Cash

(1) Independence. The security of the digital cash is not dependent on any physical location. The cash can be transferred through computer networks.

(2) Security. The digital cash cannot be copied and reused.

(3) Privacy (Untraceability). The privacy of the user is protected; no one can trace the relationship between the user and his purchases.

3.2 Requirements for Digital Cash (Continued)

(4) Off-line payment. When a user pays for a purchase with electronic cash, meaning no communication with the central bank is needed during the transaction.

(5) Transferability. The digital cash can be transferred to other users.

(6) Divisibility. A piece of digital cash in a given amount can be subdivided into smaller pieces of cash in smaller amounts. (Of course, everything has to total up properly in the end.)

3.3 Brands’s Digital Cash Scheme We describe a system that satisfies 1 through 4.

The system is much more complicated than the centuries old system of actual coins. This is because electronic objects can be reproduced at essentially no cost, in contrast to physical cash, which has usually been rather difficult to counterfeit. Therefore, steps are needed to catch electronic cash counterfeiters. This means that something like a user’s signature needs to be attached to an electronic coin. The “restricted blind signature” is used to preserve the anonymity.

3.3.1 Architecture of Brands’s Scheme

ParticipantsBankSpenderMerchant

AlgorithmsInitializationCreating a coinSpending a coinDepositing a coin

Bank

Spender Merchant

Initialization Initialization

Initialization

Creating a coin

Spending a coin

Depositing a coin

3.3.2 Algorithms of Brands’s Scheme

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intergers of tuple-4 a takefirst The . modulointeger

an outputs andinput as intergers of tuple-5 a take

first Thefunctions.hash public select two Also (4)

). , ,(Publish (3)

. modulo order with , ,element an Select (2)

prime.

also is 2/)1(such that prime large a Choose (1)


merchant. thespender, thebank, theauthority,

central someby once done istion Initializa :SUMMARY

tionInitializa

0

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5 Algorithm

3.3.2 Algorithms of Brands’s Scheme (Continued)

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6 Algorithm


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spender. heidentify t

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Thank You!

Lecture 12 E-Commerce and Digital Cash. As communication technologies, such as the Internet and wireless networks, have advanced, new avenues of commerce.

Documents

transaction scheme continued1

electronic commerce

credit card number

basic digital signature

credit fraud

vital credit information

existing credit card

set protocol