Design of a protocol for secure internet stock trading

Abstract

On the internet, many financial services such as stock broking, banking and the payment are provided recently. But the fundamental security problem of the Internet is cited as one of greatest barrier to many electronic financial services. In the credit card arena, the SET protocol is devised for secure card payment services. In this research, we attempt to design a protocol named SIST (Secure Internet Stock Trading) for electronic stock trading on the Internet, which resembles the SET protocol for credit card usage. For this purpose, we first analyze the standard stock trading procedure. Because the Internet can be easily exposed to a lot of hacker``s attack in comparison with the other channels, the notion of public cryptography and certification are adopted like SET. The entities in the SIST protocol are investors, trade brokers, Stock Exchange, banks, certification authorities. We classified messages into four categories, the interoperability is considered in designing the protocol SIST, is composed of security layer and message layer. The security layer describes action for security, and the message layer describes message definitions for stock trading. This research should contribute in establishing a standard protocol of cyber stock trading.