cryptonomicon

In 1999 Neal Stephenson explained Bitcoin to the world a decade before it was invented.

Cryptonomicon is set in two time periods:

One group of characters include World War II Allied codebreakers and tactical-deception operatives affiliated with the Government Code and Cypher School at Bletchley Park, and disillusioned Axis military and intelligence figures.

The second narrative is set in the late 1990s, with characters that are descendants of those in the earlier time period.

• They employ cryptographically secured computer networks to build an underground data haven.
• Their goal is to facilitate anonymous Internet banking using electronic money and digital gold currency.
• Their long-term objective is to distribute Holocaust Education and Avoidance Pod (HEAP) media to instruct genocide-targeted populations on defensive warfare.

Historical topics:

IBM 7950 (Harvest)

Custom built add-on to the Stretch computer (IBM's first transistorized supercomputer) installed at the NSA.

• Delivered 1962, operated until 1976.
• Designed for cryptanalysis.

New Mexico's Crypto-Jews

A small Hispanic group of Sephardi Jews in northern New Mexico.

• Possibly one of the oldest groups of practicing Jews in North America.
• Early Spanish settlers of Jewish descent were forcibly converted to Catholicism as Conversos or New Christians after 1492.
• Some of these families settled in Mexico City in the 1530s and 1540s.
• Some converted back to Judaism while others maintained Jewish beliefs and practices in secret.

After the Spanish Inquisition came to the New World in 1571, the conversos were threatened with death if it was found they were practicing Judaism.

• In 1598 the first expedition was made to New Mexico with some conversos.
• Other conversos fled to the northwestern frontier of the Spanish Empire, now the American Southwest, to evade the threat of discovery.
• Outwardly Catholic, these forced converts maintained Jewish practices and customs for generations in secret, hence their name.

Asian Financial Crisis

A period of financial crisis in East Asia beginning in July 1997 that raised fears of a worldwide economic meltdown due to financial contagion.

• The crisis started in Thailand with the financial collapse of the Thai baht after the Thai government was forced to float the baht due to lack of foreign currency to support its currency peg to the U.S. dollar.
• At the time, Thailand had acquired a burden of foreign debt that made the country effectively bankrupt even before the collapse of its currency.

Effects of the crises in Southeast Asia and Japan included:

• Slumping currencies
• Devalued stock markets and other asset prices
• Steep rise in private debt

Indonesia, South Korea, and Thailand were most affected by the crisis.

• Foreign debt-to-GDP ratios rose from 100% to 167%.
• Although most of the governments of Asia had seemingly sound fiscal policies, the IMF injected $40 billion to stabilize the currencies of the economies hit hardest the crisis.
• The efforts to stem a global economic crisis did little to stabilize the domestic situation in Indonesia. President Suharto was forced to step down after 30 years in power in the wake of widespread rioting following price increases caused by a drastic devaluation of the rupiah.
• Growth in the Philippines dropped to virtually zero in 1998. By 1999, however, the economies of Asia were beginning to recover.

Until 1999 Asia attracted almost half of the total capital inflow into developing countries.

• The economies of Southeast Asia in particular maintained high interest rates attractive to foreign investors looking for a high rate of return.
• As a result, the region's economies received a large inflow of money and experienced a dramatic run-up in asset prices.
• At the same time, the regional economies of Thailand, Malaysia, Indonesia, Singapore and South Korea experienced high growth rates, of 8–12% GDP, in the late 1980s and early 1990s.
• This achievement was widely acclaimed by financial institutions including the IMF and World Bank, and was known as part of the "Asian economic miracle".

Cryptographic topics:

Enigma Machines

A series of electro-mechanical rotor cipher machines used in the early- to mid-20th century to protect commercial, diplomatic and military communication.

• Invented by the German engineer Arthur Scherbius at the end of WWI.
• Early models were used commercially from the early 1920s, but Nazi Germany military models had a plugboard enabling far more complex codes.

Solitaire

Cryptographic algorithm designed by Bruce Schneier at the request of Stephenson.

• Used by agents to communicate securely without having to rely on electronics or incriminating tools.
• Designed to be a manual cryptosystem calculated with a deck of playing cards.
• It is called Pontifex in the novel to hide the fact that it involves playing cards.

The algorithm generates a stream of values that are combined with the message to encrypt/decrypt. Each value of the keystream is to be used for one value of the message, thus the keystream will need to be the same length as the message.

• In a totalitarian environment a deck of cards is more affordable (and less incriminating) than a personal computer with an array of cryptological utilities.
• Schneier warns any potential users in the Appendix that just about everyone with an interest in cryptanalysis (like government surveillance agencies) will know about this algorithm.

One-Time Pad

An encryption technique that requires a single-use pre-shared key of at least the same length as the encrypted message.

• Several of the characters in the book communicate with each other through the use of One-time pads.
• The story posits a variation of the OTP technique wherein there is no pre-shared key - the key is instead generated algorithmically.

Van Eck Phreaking

A form of eavesdropping using special equipment to pick up side-band electromagnetic emissions from electronics devices. Phreaking is the process of exploiting telephone networks, used here because of its connection to eavesdropping.

• These emissions correlate to hidden signals and can be recreated in order to spy on the electronic device.
• Side-band electromagnetic radiation emissions can be captured from keyboards, computer displays, printers, and other electronic devices.
• Dutch researcher Wim van Eck published the first paper on it in 1985.

Van Eck phreaking might be used to compromise the secrecy of votes in an election using electronic voting.