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Since the hack was first disclosed in December, NXP executives have downplayed its severity. For one, they say the Mifare Classic is a lower-end product that was never designed for locking down cars, bank accounts, or electronic passport information. They also say the attack defeats only a single layer of security and that additional layers would most likely prevent any misuse.

Paul de Bot, an NXP vice president of strategy and business development, also pointed to a report issued two months ago by a Dutch research institute called TNO. It concluded that the attack would be costly to carry out and would require hours to break each card. It also said that it would take several more years before the attackers are able to lower their costs and cut the amount of time.

"You need to start this procedure over and over again for each individual card," de Bot told El Reg. "Even though there may be possibilities to review keys for individual cards, if the infrastructure has appropriate measures, it would not be possible to build a criminal business case" around the attack.

Nohl says this analysis is flat out wrong. Any cryptographer in possession of the weak algorithm used in the Mifare Classic can crack the card in a matter of minutes, he insisted. On Monday, he published this detailed response to the report.

NXP is correct in describing the Mifare Classic as a lower-end product. The company on Monday announced the Mifare Plus, which gives system integrators the option of using the so-called Advanced Encryption Scheme (AES), a time-tested algorithm that is widely believed to be secure. An even more expensive card doesn't use Crypto1 at all.

Still, with as many as 2 billion Mifare Classic cards sold, there's no doubt they are widely deployed. They were recently rolled into the $3bn Dutch OV-Chipkaart transportation system. It's also used by public transit systems in Boston and London. Additionally, companies and government agencies around the world use the product to control access to telecommunications equipment, chemical labs and other sensitive areas.

In addition, the attack could leak individuals' private details if the smartcards were designed to allow holders to access information such as monthly billing statements, Nohl said.

Nohl, whose PhD research involves the building of a secure, low-cost smartcard, said the moral of the story is that proprietary encryption schemes like NXP's Crypto1 are almost always a bad idea. He said the Mifare Classic isn't the only smartcard to use a home-grown algorithm, and he predicted those devices are susceptible to similar attacks.

"These standardized schemes provide a level of security that's very well understood," he said. "With anything proprietary, you can never guaranty that." ®

Internet Security Threat Report 2014

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