Duke CPS 214 - Bank Clearing and Settlement (33 pages)

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Bank Clearing and Settlement



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Bank Clearing and Settlement

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Lecture Notes


Pages:
33
School:
Duke University
Course:
Cps 214 - Networks and Distributed Systems

Unformatted text preview:

CPS 214 Bank Clearing and Settlement Quantum Key Exchange Electronic Cash ELECTRONIC CASH FALL 2000 Clearing and Settling Clearing determining the amount that one party owes another Settling transfer of funds from one party to the other Banks clear and settle every day or at least on those rare days when banks are open ELECTRONIC CASH FALL 2000 Fedwire Owned and operated by Federal Reserve Banks 7500 participant banks keep accounts with Federal Reserve Over 2 000 000 000 000 transferred per day FEDNET proprietary telecommunications network Physical security mechanisms difficult to uncover Now permits some IP or web based transactions ELECTRONIC CASH FALL 2000 Quantum Cryptography In quantum mechanics there is no way to take a measurement without potentially changing the state E g Measuring position spreads out the momentum Measuring spin horizontally spreads out the spin probability vertically Related to Heisenberg s uncertainty principal ELECTRONIC CASH FALL 2000 Using photon polarization 0 1 diagonal basis rectilinear basis measure rectilinear measure diagonal Measuring using one basis changes polarization to that basis Bennet and Brassard 1984 ELECTRONIC CASH FALL 2000 Quantum Key Exchange 1 Alice creates each random bit and then randomly encodes it in one of two bases 2 Bob measures photons in random orientations e g x x x x x orientations used measured polarizations and tells Alice in the open what orientations he used but not what he measured 3 Alice tells Bob in the open which orientations are correct 4 Bob and Alice compare a randomly chosen subset of sent received bits to detect eavesdropper 5 Susceptible to a man in the middle attack ELECTRONIC CASH FALL 2000 In the real world 10 node DARPA Quantum Network since 2004 Los Alamos NIST March 2007 148km ELECTRONIC CASH FALL 2000 15 853 Algorithms in the Real World Electronic Cash Michael I Shamos Ph D J D Co Director ELECTRONIC CASH FALL 2000 Token vs Notational Money Token money Represented by a physical



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