The ultimate guide to passwords

Davey Winder reveals how hackers smash strong passwords - and how to keep yours as secure as possible

Davey Winder
10 Feb 2012

Despite a barrage of biometrics being launched over the past decade, passwords remain our primary means of safeguarding computers, data and online services.

Whether it’s for your home laptop or a corporate rollout, devices such as fingerprint readers remain prohibitively expensive compared to the cost-free password. Even when hardware authentication devices are used – by online banks, for example – there’s no escaping the password, which is used alongside the gadget that generates a unique PIN.

The problem is that passwords are a vulnerable means of protecting anything. A recent survey into corporate password usage by Lieberman Software revealed that 51% of those questioned had ten or more passwords to remember, and 42% admitted to actively sharing passwords.

The question isn’t whether a password file is encrypted – it’s how it’s encrypted

With passwords here to stay, this has to change if data is to remain safe. Now’s the time to start learning with our ultimate guide to passwords.

How does a password work?

Before you can understand what a secure, or even an insecure, password looks like, you need to understand how a password works.

The basic notion of it being a “secret” word that, when entered into a login box, is compared against your username in a database of plain text system login passwords is flawed. Not least because a password stored in plain text is about as secure as an unlocked door bearing a big sign saying “rob me”.

The question isn’t whether a password file is encrypted – it’s how it’s encrypted. Some systems still rely on basic encryption using a reversible algorithm, so that when you log in, the password associated with your username is decrypted and access is authorised.

This is dangerously insecure, because a hacker who receives access to the encrypted database file can attempt to reverse-engineer the encryption algorithm, and thus gain access to the full password list.

That’s why the majority of today’s passwords are converted into a hash – a one-way mathematical function – and that hash value is stored in the database instead of the actual password itself.

A hashed password is encrypted using a one-way algorithm that, in effect, turns it into a long number. This means it can be readily decrypted to find the original value of the password in question.

However, as the hashing process effectively destroys the password data itself, it’s all but impossible to reconstruct a password from that encrypted hash.

So you type your password into the system and it then compares your hash value against the hash value stored in the user list – if they match, you’re in. A hacker gaining access to that database of hash values is still none the wiser as to users’ passwords.

Not that a hashed password is totally secure: two identical passwords would share the same hash value, as the algorithm creates them using the original character string as the base.

If a hacker gained access to the database, they could identify user groups with matching hash values as likely to be using a dictionary word, and launch a dictionary attack on those to uncover it. Also, the most dedicated of hackers – such as those working for nation states and organised crime syndicates – will likely use something called a rainbow table to attack a hashed password list.

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