Yet other systems generate OTPs on the server-side and send them to the user using an out-of-band channel such as SMS messaging.
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Other systems consist of software that runs on the user's mobile phone. Some systems use special electronic security tokens that the user carries and that generate OTPs and show them using a small display. There are also different ways to make the user aware of the next OTP to use. A number of OTP systems also aim to ensure that a session cannot easily be intercepted or impersonated without knowledge of unpredictable data created during the previous session, thus reducing the attack surface further. A second major advantage is that a user who uses the same (or similar) password for multiple systems, is not made vulnerable on all of them, if the password for one of these is gained by an attacker. This means that a potential intruder who manages to record an OTP that was already used to log into a service or to conduct a transaction will not be able to use it, since it will no longer be valid.
The most important advantage addressed by OTPs is that, in contrast to static passwords, they are not vulnerable to replay attacks.
Many systems that use OTPs do not securely implement them, and attackers can still learn the password through phishing attacks to impersonate the authorized user. On the downside, OTPs can be intercepted or rerouted, and hard tokens can get lost, damaged, or stolen. OTPs have been discussed as a possible replacement for, as well as an enhancer to, traditional passwords. This is necessary because otherwise, it would be easy to predict future OTPs by observing previous ones. OTP generation algorithms typically make use of pseudorandomness or randomness to generate a shared key or seed, and cryptographic hash functions, which can be used to derive a value but are hard to reverse and therefore difficult for an attacker to obtain the data that was used for the hash. OTPs avoid several shortcomings that are associated with traditional (static) password-based authentication a number of implementations also incorporate two-factor authentication by ensuring that the one-time password requires access to something a person has (such as a small keyring fob device with the OTP calculator built into it, or a smartcard or specific cellphone) as well as something a person knows (such as a PIN).
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One time authorization code as used in Yammer's desktop clientĪ one-time password ( OTP), also known as a one-time PIN, one-time authorization code ( OTAC) or dynamic password, is a password that is valid for only one login session or transaction, on a computer system or other digital device.