Source: http://feeds.feedburner.com/~r/gizmodo/full/~3/387328979/verayo-rfid-chips-use-electronic-dna-to-make-them-unclonable
Here's a challenge to hackers everywhere if I've ever heard one—a company named Verayo claims to have created an RFID chip that's completely unclonable thanks to a type of electronic DNA technology called Physical Unclonable Functions (PUF). Unlike basic passive RFID chips, where data can be easily copied from one chip to another, Verayo's PUF-fy RFID chips use a series of challenge-and-response pairs to make counterfeiting nigh impossible (or so they say.)
The company has an academic paper explaining how their tags work, for those of us more programming literate. Each 64 bit challenge-response duo is random and generated on demand. Pairs are then uploaded to a main database for authentication purposes. According to Verayo, even if information is copied onto a new chip, it'll have a different challenge and response. One possible point of attack already identified—if someone breaks into the main database and harvests all existing challenge-response information, what happens then? [Verayo via Slashdot]