“FIDO hopes to replace passwords with a system built around public key cryptography. To register with a FIDO site, you won’t enter a password into the site. Instead, hitting register will alert your authentication devices—typically an app on your smartphone—of the attempt to register. If that attempt is approved (for example, by using a registered fingerprint or entering a PIN), the device will generate a public/private key pair. The public key will be sent to the online service; the private key will be retained on the authentication device.”

http://arstechnica.com/security/2013/12/microsoft-joins-fido-group-hoping-to-replace-passwords-with-public-key-cryptography/

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