mh wrote:Currently I'm playing around with the Texas Instruments MSP430 microprocessor - they have a $20+shipping starter kit, it's the size of a USB stick, and it might very well work fine as a key. At the same time that processor has very little power consumption, and would probably work with a standard CR2032 lithium cell for quite a long time.
Using the RSA enc/decryption algorithm (for a public/private style system) could be the way to go. The question is if a reasonable length (1024 bits) of key can be manipulated with small, power efficient hardware.
I've had a quick squiz at the specs of some of the ATtiny micros, they look promising - very very very low power in standby mode, pretty low on as well. Not sure if 1Mhz@8bit is going to hack a 1024 bit key in reasonable time though. Let us know how you get on with the MSP430.