The economic viability of the imminent revolution in computer and communication system development using reusable cores is dependent on the development of reliable and efficient techniques for intellectual property protection. We introduce the first intellectual property protection technique which combines watermarking and cryptography mechanisms to protect CAD and compilation tools and reusable hardware (core) components. The essence of the new approach is the addition of a system of design and timing constraints which encodes the encrypted author's signature. The constraints are selected in such a way that they result in the minimal hardware overhead impact while embedding the signature which is unique and difficult to detect and remove.

We prove that forgery of a signature is a computationally intractable problem which can be made arbitrarily computationally difficult. The watermarking technique is generic in a sense that can be applied within an arbitrary synthesis and compilation task at any level of the design process. The technique is also fully transparent to manual and automatic design processes and therefore can be used in conjunction with any available or future set of design tools. We also show how to use fingerprinting, secret splitting, timestamping, proxy signatures, group signatures, key escrow, erasable signatures, and covert channel techniques for a variety of intellectual property protection protocols.

On a large set of industrial-strength designs objective and subjective studies indicate the effectiveness of the new approach in a sense that the signature data, which are highly resilient, difficult to detect, forge, and remove, and yet easy to enforce and verify, can be embedded in designs with very low hardware overhead.

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