> I have a strong preference for portable, transparent solutions.

That I can understand and would always be the best solution, but not always 
possible.
 

> There is also the small point that it has been broken (see Wikipedia).

As I read it, it was mostly before Windows XP. Since Windows Server 
2003/Windows 7, a lot of changes in DPAPI has made it more secure. The security 
analysis from Passcape concludes:

"DPAPI deserves such close attention at least for the fact that it's the only 
password-based system that provides appropriate and thoroughly thought out 
protection of user's personal data. None of the operating systems has a more 
viable alternative to DPAPI!

We should, perhaps, mention that the first implementation of DPAPI had a number 
of serious flaws, which could enable a potential malefactor to easily 
compromise user's data protected by DPAPI.

The first pancake is known to be always lumpy. In all the sequel operating 
systems, beginning with Windows XP, those vulnerabilities have not merely been 
eliminated; the entire DPAPI system has undergone a major revision. In 
particular, it has adopted new encryption algorithms; that has made the Master 
Key password lookup speed about 1000 (!) times slower. Master Key encryption 
errors that potentially allowed any user to gain access to any files encrypted 
by EFS were fixed. The local Master Key backup system has been replaced with 
the password reset disk, etc.

Overall, the DPAPI encryption system has become more robust, powerful, meeting 
the stringent requirements of password security."


Brian Vraamark

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