I’m at Financial Crypto 2018 and will try to liveblog some of the sessions in followups to this post.
I’m at the twenty-fifth Security Protocols Workshop, of which the theme is protocols with multiple objectives. I’ll try to liveblog the talks in followups to this post.
Last week I gave a keynote talk at CCS about DigiTally, a project we’ve been working on to extend mobile payments to areas where the network is intermittent, congested or non-existent.
The Bill and Melinda Gates Foundation called for ways to increase the use of mobile payments, which have been transformative in many less developed countries. We did some research and found that network availability and cost were the two main problems. So how could we do phone payments where there’s no network, with a marginal cost of zero? If people had smartphones you could use some combination of NFC, bluetooth and local wifi, but most of the rural poor in Africa and Asia use simple phones without any extra communications modalities, other than those which the users themselves can provide. So how could you enable people to do phone payments by simple user actions? We were inspired by the prepayment electricity meters I helped develop some twenty years ago; meters conforming to this spec are now used in over 100 countries.
We got a small grant from the Gates Foundation to do a prototype and field trial. We designed a system, Digitally, where Alice can pay Bob by exchanging eight-digit MACs that are generated, and verified, by the SIM cards in their phones. For rapid prototyping we used overlay SIMs (which are already being used in a different phone payment system in Africa). The cryptography is described in a paper we gave at the Security Protocols Workshop this spring.
Last month we took the prototype to Strathmore University in Nairobi to do a field trial involving usability studies in their bookshop, coffee shop and cafeteria. The results were very encouraging and I described them in my talk at CCS (slides). There will be a paper on this study in due course. We’re now looking for partners to do deployment at scale, whether in phone payments or in other apps that need to support value transfer in delay-tolerant networks.
I’m at the 24th security protocols workshop in Brno (no, not Borneo, as a friend misheard it, but in the Czech republic; a two-hour flight rather than a twenty-hour one). We ended up being bumped to an old chapel in the Mendel museum, a former monastery where the monk Gregor Mendel figured out genetics from the study of peas, and for the prosaic reason that the Canadian ambassador pre-empted our meeting room. As a result we had no wifi and I have had to liveblog from the pub, where we are having lunch. The session liveblogs will be in followups to this post, in the usual style.
I will be trying to liveblog Financial Cryptography 2016, which is the twentieth anniversary of the conference. The opening keynote was by David Chaum, who invented digital cash over thirty years ago. From then until the first FC people believed that cryptography could enable commerce and also protect privacy; since then pessimism has slowly set in, and sometimes it seems that although we’re still fighting tactical battles, we’ve lost the war. Since Snowden people have little faith in online privacy, and now we see Tim Cook in a position to decide which seventy phones to open. Is there a way to fight back against a global adversary whose policy is “full take”, and where traffic data can be taken with no legal restraint whatsoever? That is now the threat model for designers of anonymity systems. He argues that in addition to a large anonymity set, a future social media system will need a fixed set of servers in order to keep end-to-end latency within what chat users expect. As with DNS we should have servers operated by (say ten) different principals; unlike in that case we don’t want to have most of the independent parties financed by the US government. The root servers could be implemented as unattended seismic observatories, as reported by Simmons in the arms control context; such devices are fairly easy to tamper-proof.
The crypto problem is how to do multi-jurisdiction message processing that protects not just content but also metadata. Systems like Tor cost latency, while multi-party computation costs a lot of cycles. His new design, PrivaTegrity, takes low-latency crypto building blocks then layers on top of them transaction protocols with large anonymity sets. The key component is c-Mix, whose spec up as an eprint here. There’s a precomputation using homomorphic encryption to set up paths and keys; in real-time operations each participating phone has a shared secret with each mix server so things can run at chat speed. A PrivaTegrity message is four c-Mix batches that use the same permutation. Message models supported include not just chat but publishing short anonymous messages, providing an untraceable return address so people can contact you anonymously, group chat, and limiting sybils by preventing more than one pseudonym being used. (There are enduring pseudonyms with valuable credentials.) It can handle large payloads using private information retrieval, and also do pseudonymous digital transactions with a latency of two seconds rather than the hour or so that bitcoin takes. The anonymous payment system has the property that the payer has proof of what he paid to whom, while the recipient has no proof of who paid him; that’s exactly what corrupt officials, money launderers and the like don’t want, but exactly what we do want from the viewpoint of consumer protection. He sees PrivaTegrity as the foundation of a “polyculture” of secure computing from multiple vendors that could be outside the control of governments once more. In questions, Adi Shamir questioned whether such an ecosystem was consistent with the reality of pervasive software vulnerabilities, regardless of the strength of the cryptography.
I will try to liveblog later sessions as followups to this post.
I’m at Princeton where Ed Snowden is due to speak by live video link in a few minutes, and have a discussion with Bart Gellmann.
Yesterday he spent four hours with a group of cryptographers from industry and academia, of which I was privileged to be one. The topic was the possible and likely countermeasures, both legal and technical, against state surveillance. Ed attended as the “Snobot”, a telepresence robot that let him speak to us, listen and move round the room, from a studio in Moscow. As well as over a dozen cryptographers there was at least one lawyer and at least one journalist familiar with the leaked documents. Yesterday’s meeting was under the Chatham House rule, so I may not say who said what; any new disclosures may have been made by Snowden, or by one of the journalists, or by one of the cryptographers who has assisted journalists with the material. Although most of what was discussed has probably appeared already in one place or another, as a matter of prudence I’m publishing these notes on the blog while I’m enjoying US first-amendment rights, and will sanitise them from my laptop before coming back through UK customs.
The problem of state surveillance is a global one rather than an NSA issue, and has been growing for years, along with public awareness of it. But we learned a lot from the leaks; for example, wiretaps on the communications between data centres were something nobody thought of; and it might do no harm to think a bit more about the backhaul in CDNs. (A website that runs TLS to a CDN and then bareback to the main server is actually worse than nothing, as we lose the ability to shame them.) Of course the agencies will go for the low-hanging fruit. Second, we also got some reassurance; for example, TLS works, unless the agencies have managed to steal or coerce the private keys, or hack the end systems. (This is a complex discussion given CDNs, problems with the CA ecology and bugs like Heartbleed.) And it’s a matter of record that Ed trusted his life to Tor, because he saw from the other side that it worked.
Third, the leaks give us a clear view of an intelligence analyst’s workflow. She will mainly look in Xkeyscore which is the Google of 5eyes comint; it’s a federated system hoovering up masses of stuff not just from 5eyes own assets but from other countries where the NSA cooperates or pays for access. Data are “ingested” into a vast rolling buffer; an analyst can run a federated search, using a selector (such as an IP address) or fingerprint (something that can be matched against the traffic). There are other such systems: “Dancing oasis” is the middle eastern version. Some xkeyscore assets are actually compromised third-party systems; there are multiple cases of rooted SMS servers that are queried in place and the results exfiltrated. Others involve vast infrastructure, like Tempora. If data in Xkeyscore are marked as of interest, they’re moved to Pinwale to be memorialised for 5+ years. This is one function of the MDRs (massive data repositories, now more tactfully renamed mission data repositories) like Utah. At present storage is behind ingestion. Xkeyscore buffer times just depend on volumes and what storage they managed to install, plus what they manage to filter out.
As for crypto capabilities, a lot of stuff is decrypted automatically on ingest (e.g. using a “stolen cert”, presumably a private key obtained through hacking). Else the analyst sends the ciphertext to CES and they either decrypt it or say they can’t. There’s no evidence of a “wow” cryptanalysis; it was key theft, or an implant, or a predicted RNG or supply-chain interference. Cryptanalysis has been seen of RC4, but not of elliptic curve crypto, and there’s no sign of exploits against other commonly used algorithms. Of course, the vendors of some products have been coopted, notably skype. Homegrown crypto is routinely problematic, but properly implemented crypto keeps the agency out; gpg ciphertexts with RSA 1024 were returned as fails.
With IKE the NSA were interested in getting the original handshakes, harvesting them all systematically worldwide. These are databased and indexed. The quantum type attacks were common against non-crypto traffic; it’s easy to spam a poisoned link. However there is no evidence at all of active attacks on cryptographic protocols, or of any break-and-poison attack on crypto links. It is however possible that the hacking crew can use your cryptography to go after your end system rather than the content, if for example your crypto software has a buffer overflow.
What else might we learn from the disclosures when designing and implementing crypto? Well, read the disclosures and use your brain. Why did GCHQ bother stealing all the SIM card keys for Iceland from Gemalto, unless they have access to the local GSM radio links? Just look at the roof panels on US or UK embassies, that look like concrete but are actually transparent to RF. So when designing a protocol ask yourself whether a local listener is a serious consideration.
In addition to the Gemalto case, Belgacom is another case of hacking X to get at Y. The kind of attack here is now completely routine: you look for the HR spreadsheet in corporate email traffic, use this to identify the sysadmins, then chain your way in. Companies need to have some clue if they’re to stop attacks like this succeeding almost trivially. By routinely hacking companies of interest, the agencies are comprehensively undermining the security of critical infrastructure, and claim it’s a “nobody but us” capability. however that’s not going to last; other countries will catch up.
Would opportunistic encryption help, such as using unauthenticated Diffie-Hellman everwhere? Quite probably; but governments might then simply compel the big service forms to make the seeds predictable. At present, key theft is probably more common than key compulsion in US operations (though other countries may be different). If the US government ever does use compelled certs, it’s more likely to be the FBI than the NSA, because of the latter’s focus on foreign targets. The FBI will occasionally buy hacked servers to run in place as honeypots, but Stuxnet and Flame used stolen certs. Bear in mind that anyone outside the USA has zero rights under US law.
Is it sensible to use medium-security systems such as Skype to hide traffic, even though they will give law enforcement access? For example, an NGO contacting people in one of the Stans might not want to incriminate them by using cryptography. The problem with this is that systems like Skype will give access not just to the FBI but to all sorts of really unsavoury police forces.
FBI operations can be opaque because of the care they take with parallel construction; the Lavabit case was maybe an example. It could have been easy to steal the key, but then how would the intercepted content have been used in court? In practice, there are tons of convictions made on the basis of cargo manifests, travel plans, calendars and other such plaintext data about which a suitable story can be told. The FBI considers it to be good practice to just grab all traffic data and memorialise it forever.
The NSA is even more cautious than the FBI, and won’t use top exploits against clueful targets unless it really matters. Intelligence services are at least aware of the risk of losing a capability, unlike vanilla law enforcement, who once they have a tool will use it against absolutely everybody.
Using network intrusion detection against bad actors is very much like the attack / defence evolution seen in the anti-virus business. A system called Tutelage uses Xkeyscore infrastructure and matches network traffic against signatures, just like AV, but it has the same weaknesses. Script kiddies are easily identifiable from their script signatures via Xkeyscore, but the real bad actors know how to change network signatures, just as modern malware uses packers to become highly polymorphic.
Cooperation with companies on network intrusion detection is tied up with liability games. DDoS attacks from Iran spooked US banks, which invited the government in to snoop on their networks, but above all wanted liability protection.
Usability is critical. Lots of good crypto never got widely adopted as it was too hard to use; think of PGP. On the other hand, Tails is horrifically vulnerable to traditional endpoint attacks, but you can give it as a package to journalists to use so they won’t make so many mistakes. The source has to think “How can I protect myself?” which makes it really hard, especially for a source without a crypto and security background. You just can’t trust random journalists to be clueful about everything from scripting to airgaps. Come to think of it, a naive source shouldn’t trust their life to securedrop; he should use gpg before he sends stuff to it but he won’t figure out that it’s a good idea to suppress key IDs. Engineers who design stuff for whistleblowers and journalists must be really thoughtful and careful if they want to ensure their users won’t die when they screw up. The goal should be that no single error should be fatal, and so long as their failures aren’t compounded the users will stay alive. Bear in mind that non-roman-language countries use numeric passwords, and often just 8 digits. And being a target can really change the way you operate. For example, password managers are great, but not for someone like Ed, as they put too many of the eggs in one basket. If you’re a target, create a memory castle, or a token that can be destroyed on short notice. If you’re a target like Ed, you have to compartmentalise.
On the policy front, one of the eye-openers was the scale of intelligence sharing – it’s not just 5 eyes, but 15 or 35 or even 65 once you count all the countries sharing stuff with the NSA. So how does governance work? Quite simply, the NSA doesn’t care about policy. Their OGC has 100 lawyers whose job is to “enable the mission”; to figure out loopholes or new interpretations of the law that let stuff get done. How do you restrain this? Could you use courts in other countries, that have stronger human-rights law? The precedents are not encouraging. New Zealand’s GCSB was sharing intel with Bangladesh agencies while the NZ government was investigating them for human-rights abuses. Ramstein in Germany is involved in all the drone killings, as fibre is needed to keep latency down low enough for remote vehicle pilots. The problem is that the intelligence agencies figure out ways to shield the authorities from culpability, and this should not happen.
Jurisdiction is a big soft spot. When will CDNs get tapped on the shoulder by local law enforcement in dodgy countries? Can you lock stuff out of particular jurisdictions, so your stuff doesn’t end up in Egypt just for load-balancing reasons? Can the NSA force data to be rehomed in a friendly jurisdiction, e.g. by a light DoS? Then they “request” stuff from a partner rather than “collecting” it.
The spooks’ lawyers play games saying for example that they dumped content, but if you know IP address and file size you often have it; and IP address is a good enough pseudonym for most intel / LE use. They deny that they outsource to do legal arbitrage (e.g. NSA spies on Brits and GCHQ returns the favour by spying on Americans). Are they telling the truth? In theory there will be an MOU between NSA and the partner agency stipulating respect for each others’ laws, but there can be caveats, such as a classified version which says “this is not a binding legal document”. The sad fact is that law and legislators are losing the capability to hold people in the intelligence world to account, and also losing the appetite for it.
The deepest problem is that the system architecture that has evolved in recent years holds masses of information on many people with no intelligence value, but with vast potential for political abuse.
Traditional law enforcement worked on individualised suspicion; end-system compromise is better than mass search. Ed is on the record as leaving to the journalists all decisions about what targeted attacks to talk about, as many of them are against real bad people, and as a matter of principle we don’t want to stop targeted attacks.
Interference with crypto in academia and industry is longstanding. People who intern with a clearance get a “lifetime obligation” when they go through indoctrination (yes, that’s what it’s called), and this includes pre-publication review of anything relevant they write. The prepublication review board (PRB) at the CIA is notoriously unresponsive and you have to litigate to write a book. There are also specific programmes to recruit cryptographers, with a view to having friendly insiders in companies that might use or deploy crypto.
The export control mechanisms are also used as an early warning mechanism, to tip off the agency that kit X will be shipped to country Y on date Z. Then the technicians can insert an implant without anyone at the exporting company knowing a thing. This is usually much better than getting stuff Trojanned by the vendor.
Western governments are foolish to think they can develop NOBUS (no-one but us) technology and press the stop button when things go wrong, as this might not be true for ever. Stuxnet was highly targeted and carefully delivered but it ended up in Indonesia too. Developing countries talk of our first-mover advantage in carbon industrialisation, and push back when we ask them to burn less coal. They will make the same security arguments as our governments and use the same techniques, but without the same standards of care. Bear in mind, on the equities issue, that attack is way way easier than defence. So is cyber-war plausible? Politically no, but at the expert level it might eventually be so. Eventually something scary will happen, and then infrastructure companies will care more, but it’s doubtful that anyone will do a sufficiently coordinated attack on enough diverse plant through different firewalls and so on to pose a major threat to life.
How can we push back on the poisoning of the crypto/security community? We have to accept that some people are pro-NSA while others are pro-humanity. Some researchers do responsible disclosure while others devise zero-days and sell them to the NSA or Vupen. We can push back a bit by blocking papers from conferences or otherwise denying academic credit where researchers prefer cash or patriotism to responsible disclosure, but that only goes so far. People who can pay for a new kitchen with their first exploit sale can get very patriotic; NSA contractors have a higher standard of living than academics. It’s best to develop a culture where people with and without clearances agree that crypto must be open and robust. The FREAK attack was based on export crypto of the 1990s.
We must also strengthen post-national norms in academia, while in the software world we need transparency, not just in the sense of open source but of business relationships too. Open source makes it harder for security companies to sell different versions of the product to people we like and people we hate. And the NSA may have thought dual-EC was OK because they were so close to RSA; a sceptical purchaser should have observed how many government speakers help them out at the RSA conference!
Secret laws are pure poison; government lawyers claim authority and act on it, and we don’t know about it. Transparency about what governments can and can’t do is vital.
On the technical front, we can’t replace the existing infrastructure, so it won’t be possible in the short term to give people mobile phones that can’t be tracked. However it is possible to layer new communications systems on top of what already exists, as with the new generation of messaging apps that support end-to-end crypto with no key escrow. As for whether such systems take off on a large enough scale to make a difference, ultimately it will all be about incentives.
I’m at the 23rd Security Protocols Workshop, whose theme this year is is information security in fiction and in fact. Engineering is often inspired by fiction, and vice versa; what might we learn from this?
I will try to liveblog the talks in followups to this post.
Imagine, somewhere in the internet that no-one trusts, there is a piece of hardware, a small computer, that works just for you. You can trust it. You can depend on it. Things may get rough but it will stay there to get you through. That is Nikka, it is the fixed point on which you can build your security and trust. [Now as a Kickstarter project]
You may remember our proof-of-concept implementation of a password protection for servers – Hardware Scrambling (published here in March). The password scrambler was a small dongle that could be plugged to a Linux computer (we used Raspberry Pi). Its only purpose was to provide a simple API for encrypting passwords (but it could be credit cards or anything else up to 32 bytes of length). The beginning of something big?
It received some attention (Ars Technica, Slashdot, LWN, …), certainly more than we expected at the time. Following discussions have also taught us a couple of lessons about how people (mostly geeks in this contexts) view security – particularly about the default distrust expressed by those who discussed articles describing our password scrambler.
We eventually decided to build a proper hardware cryptographic platform that could be used for cloud applications. Our requirements were simple. We wanted something fast, “secure” (CC EAL5+ or even FIPS140-2 certified), scalable, easy to use (no complicated API, just one function call) and to be provided as a service so no-one has to pay upfront the price of an HSM if they just want to have a go at using proper cryptography for their new or old application. That was the beginning of Nikka.
This is our concept: Nikka comprises a set of powerful servers installed in secure data centres. These servers can create clusters delivering high-availability and scalability for their clients. Secure hardware forms the backbone of each server that provides an interface for simple use. The second part of Nikka are user applications, plugins, and libraries for easy deployment and everyday “invisible” use. Operational procedures, processes, policies, and audit logs then guarantee that what we say is actually being done.
We have been building it for a few months now and the scalable cryptographic core seems to work. We have managed to run long-term tests of 150 HMAC transactions per second (HMAC & RNG for password scrambling) on a small development platform while fully utilising available secure hardware. The server is hosted at ideaSpace and we use it to run functional, configuration and load tests.
We have never before designed a system with so many independent processes – the core is completely asynchronous (starting with Netty for a TCP interface) and we have quickly started to appreciate detailed trace logging we’ve implemented from the very beginning. Each time we start digging we find something interesting. Real-time visualisation of the performance is quite nice as well.
Nikka is basically a general purpose cryptographic engine with middleware layer for easy integration. The password HMAC is this time used only as one of test applications. Users can share or reserve processing units that have Common Criteria evaluations or even FIPS140-2 certification – with possible physical hardware separation of users.
If you like what you have read so far, you can keep reading, watching, supporting at Kickstarter. It has been great fun so far and we want to turn it into something useful in 2015. If it sounds interesting – maybe you would like to test it early next year, let us know! @DanCvrcek
Users don’t want to authenticate, they want to do useful or enjoyable things like sending emails, ordering groceries or playing games. To alleviate the burden of having to type passwords, Pico and several other schemes, such as SQRL and tiQR, let the user simply scan a QR code; then a cryptographic protocol authenticates the user behind the scenes and initiates a session. But users, unless they are on the move, may prefer to run their email or web browsing sessions on their full-size computer instead of on their smartphone, whose user interface is relatively limited. Therefore they don’t want an authenticated session between their smartphone and the website but between their computer and the website, even if it’s the smartphone that scans the QR code.
In the original 2011 Pico paper (footnote 37), the website kept track of which “page impression” from a web browser was related to which Pico authentication by including a nonce in each login page QR code and having the Pico sign and return it as part of the authentication. Since then, within the Pico team, there has been much discussion of the so-called Page Impression Nonce or PIN, infamous both for the attacks it enables and its unfortunate, overloaded acronym. While other schemes may have called it something different, or not called it anything at all, it was always present in one form or another because they all used it to solve this same problem of linking browser sessions to authentications.
For example, in the SQRL system each QR code contains a URL, part of which is a random nonce (the PIN in this system). The SQRL app must sign and return this URL, thus associating the nonce with the app’s per-verifier public key. The web browser then starts its session by making another request which includes the URL (and thus the PIN) and gets back a session cookie.
So what’s the problem?
The problem with this kind of mechanism is that anyone else who learns the PIN can also make that second request, thus logging themselves in as the user who scanned the QR code. For example, a bad guy can obtain a QR code and its PIN from the login page of bank.com and display it somewhere, like the login page of randomgameforum.com, for a victim to scan. Now, assuming the victim had an account at bank.com, the attacker obtains a bank.com session that the victim unsuspectingly initiated with their smartphone.
Part of the problem is that QR codes are not human-readable. Some have suggested that a simple confirmation step (“Do you really want to login to bank.com?”) might prevent such attacks, but we decided this wasn’t really good enough from a security or a usability perspective. We don’t want users to have to read the confirmation dialog and press the OK button every time they authenticate, and realistically they won’t, especially if they never normally do anything other than press OK.
Moreover, the confirmation step doesn’t help at all when the relaying of the QR code is combined with traditional phishing techniques. Consider receiving this email:
From: firstname.lastname@example.org To: email@example.com Subject: Urgent: Account security threat --- Dear Customer <compelling phishing mumbo jumbo> To keep your account secure, please scan this QR code: <login QR code with PIN known by the sender> Kind regards, Account security department
and if you oblige:
Do you really want to login to bank.com?
Now the poor user thinks “Well yes, I do, that’s exactly what the account security team asked me to do” and even worse: “I’m definitely not being phished, I remember what those security people kept telling me about checking the address of the website before logging in”.
How to fix it
The solution we came up with is called session delegation. Instead of having a nonce in each QR code, which anyone can later trade-in for an authenticated session, we have the website return a session delegation token to the Pico (not the web browser) as part of the authentication protocol. The Pico may then delegate the session to the browser on the bigger computer by sending it this token, via a secure channel. (For further details see section 4.1 of our “lousy phish” paper.) The price to pay for this strategy is that it requires a channel from the Pico to the browser, which is much harder to provide than the one in the opposite direction (the visual “QR code” channel).
We made a prototype which used Bluetooth for the delegation channel but, because Bluetooth was sometimes difficult to set up and not universally available, we even thought about using an audio cable plugged into the microphone jack of the computer. However, we were still worried about the availability and usability of these hardware-based solutions. We did a lot of research into NAT and firewall traversal techniques (such as STUN and TURN) to see if we could use peer-to-peer IP connectivity, but this is not possible in all cases without a separate signalling channel. In our latest prototype we’re using a “rendezvous point”, which is a very simple relay server we’ve designed, running in the public Internet. The rendezvous point is the most universal and usable solution, but does come with some privacy concerns, namely that the untrusted rendezvous server gets to see the Pico/computer IP address pairs which are communicating. So we still allow privacy-conscious users to adopt less convenient alternatives if they’re willing to pay the price of setting up Bluetooth, connecting cables or changing their firewall/NAT settings, but we don’t impose that cost on everyone.
The drawback of this approach is that the user’s computer requires some Pico software to receive the delegation tokens, via the rendezvous point or whatever other channel. Having to install these hurts the “deployability” of the system as a whole and could render it completely useless in situations where installing new software is not possible. But another innovation, making the delegation token take the form of a URL, means there is always a last-resort fallback channel: manual transcription. If a Pico user can’t install the software on, or doesn’t want to trust, a particular computer, they can always still retype the token URL. There are other security concerns related to having URLs which will log your browser into someone else’s account, but you’ll have to read the lousy phish paper for a more detailed discussion of this topic.
There is clearly much interest in finding a replacement for passwords and several schemes (such as US 8261089 B2, Snap2Pass, tiQR, US 20130219479 A1, QRAuth, SQRL) propose using QR codes. But upon close inspection, all of the above use a page impression nonce, making them vulnerable to session hijacking attacks. We rejected the idea that this could be solved simply by getting the user to carry out more checks and instead we propose an architectural fix which provides a more secure basis for the design of Pico.
Now that US banks are deploying credit and debit cards with chips supporting the EMV protocol, our article explores what lessons the US should learn from the UK experience of having chip cards since 2006. We address questions like whether EMV would have prevented the Target data breach (it wouldn’t have), whether Chip and PIN is safer for customers than Chip and Signature (it isn’t), whether EMV cards can be cloned (in some cases, they can) and whether EMV will protect against online fraud (it won’t).
While the EMV specification is the same across the world, they way each country uses it varies substantially. Even individual banks within a country may make different implementation choices which have an impact on security. The US will prove to be an especially interesting case study because some banks will be choosing Chip and PIN (as the UK has done) while others will choose Chip and Signature (as Singapore did). The US will act as a natural experiment addressing the question of whether Chip and PIN or Chip and Signature is better, and from whose perspective?
The US is also distinctive in that the major tussle over payment card security is over the “interchange” fees paid by merchants to the banks which issue the cards used. Interchange fees are about an order of magnitude higher than losses due to fraud, so while security is one consideration in choosing different sets of EMV features, the question of who pays how much in fees is a more important factor (even if the decision is later claimed to be justified by security). We’re already seeing results of this fight in the courts and through legislation.
EMV is coming to the US, so it is important that banks, customers, merchants and regulators know the likely consequences and how to manage the risks, learning from the lessons of the UK and elsewhere. Discussion of these and further issues can be found in our article.