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How is Quantum Cryptography used for Secure Financial Transactions

Abstract

In recent years quantum physicists have proposed a new type of cryptosystem known as quantum cryptography (QC) which has proven promising for online security in public key infrastructure (PKI). Researchers are now examining QC as a possible alternative to classical encryption algorithms, such as AES, RSA. Unlike many classical encryption algorithms, QC does not depend on factoring large integers into their primes but on the fundamental principles of quantum physics. It is more secure because an intruder will never be able to replicate a photon to recreate the key. QC allows the exchange of cryptographic keys, a method known as quantum key distribution (QKD), whose security is guaranteed by quantum physics. Any eavesdropping will change the state of the photon that will alarm the user of the presence of hacking. Once cryptographic keys have been exchanged, strong cryptographic algorithms are used to encrypt and decrypt the flow of data transmitted over an optical fiber. QC would allow users to overcome the vulnerabilities of public key cryptography. The paper reviews the systematic and chronological development of QC, pioneering methods of QKD, QKD products, secure quantum networks, and finally how QC has been used to securely transfer funds in Europe.

This paper was presented at the Second International Conference on e-Technologies and Networks for Development (ICeND 2013) in Kuala Lumpur, Malaysia on March 4-6, 2013.

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