History of Hagelin-Cryptos and Crypto AG
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This is the story of Boris Hagelin, a brilliant engineer, and his famous cipher machines. He is the only inventor and developer of crypto machines in history to have made a fortune in that market. Hagelin and Crypto AG were most respected names in the world of crypto machines and have dominated the commercial market of cryptology for many decades, until the firm was liquidated in 2019. Soon after, disclosed CIA documents revealed that the CIA and BND joint-purchased Crypto AG from Boris Hagelin, as early as 1970, making it the largest ever worldwide compromise of secure communications for many decades.

The Man and the Firm

Boris Hagelin

Boris Hagelin was born on July 2nd, 1892 in Adschikent, Russia. His Swedish father sent him to Sweden, where he graduated in 1914 as mechanical engineer. His future was already planned in the Nobel company's Oilfields, where his father was the manager. Initially, he specialized in electrical engineering in order to become supervisor of the construction of an electric power plant for the Nobel Company in Baku. After the revolution in 1920 the Nobel family entered into a partnership with the Standard Oil Company in the US, and Boris moved to the US to work in their General engineering Department. After one year he returned to Sweden.

Emanuel Nobel asked Boris Hagelin to supervise a small Swedish company, A.B. Cryptograph, which manufactured cipher machines, invented by the Swedish engineer Arvid Damm. In 1925 he took over management and started developing new machines. In 1932 A.B Cryptoteknik replaced the liquidated A.B. Cryptograph. Hagelin promoted his popular C-35 cipher machine during the Second World War in the United States. Adapted for the U.S. Army under the name M-209, this machine became a huge success and Hagelin made a fortune.

After WWII Hagelin moved to Zug in neutral Switzerland and established Crypto AG in 1952. This relocation was required since Sweden considered Cryptographic equipment as weapons, and thus prohibited their export. The pre-war reputation of mechanical "Hagelin Cryptos" devices and the need for enciphered telegraph equipment helped the firm to grow and laid the foundation for a new generation of electronic cipher equipment. Boris Hagelin died in 1983 at the age of 91.

Hagelin B-21 and the First Success

In 1925 the Swedish General Staff contacted A.B. Cryptograph to design a machine that would be superior to the German Enigma. Hagelin developed a prototype for evaluation called B-21. The B-21 was approved for the Swedish General Staff and Hagelin also sold the machine to several other countries. Its principle was based on Arvid Damm's simplified rotors, a 5 x 5 grid design.

The machine had a keyboard, 2 rotors of which the stepping was controlled by two pairs of pin-wheels and a display with 25 lamps that presented the output of the encipherment or decipherment. The machine was operated on 110 or 220 volt and the lamp panel was powered by a battery. Depressing a key would close two contacts, each contact in one of two groups of five contacts. The signal then passed through two rotors to the 25 lamps. Interchangeable leads, in series with the rotors, could be connected as desired.

This machine was the first to apply pin-wheels, a feature that was used in many of its successors. A pin-wheel is a disk with a number of axial holes in which pins are located. These pins can be moved either to the left or to the right side of the disk. On one side, these pins are inactive, on the other side active. With each step, the pin-wheel moves one pin position. Several different pin-wheels with different numbers of pins without a common factor are used to obtain a very long key period.

In 1932 the French Army was interested in the B-21 but asked for two important modifications. The machine had to be portable and should be able to print the text. Hagelin developed the B-211 which could be operated either with electric power or by hand with a crank. He replaced the lamp panel with a type-wheel printing mechanism and the ciphering circuits were powered by a battery. About 500 B-211 machines were built. In 1940 Hagelin installed a workshop in Sweden with the profits of the successful B-211 and A.B. Cryptograph was renamed in A.B. Ingenieursfirma Cryptoteknik. More technical details are found on the B-21 page.

Image © John Alexander

Hagelin B-21
Image © John Alexander

The C Type Machines

Already in 1934 the French Cipher Bureau asked Hagelin to develop a compact cipher machine that could also print. Hagelin got the idea to adapt a calculating mechanism from a money changer into a small crypto device. The infamous pin-and-lug machines were born.

The first machine, the C-35, consisted of a drum with 25 bars, five pin-wheels (identical to the ones used in the B-21) and an alphabet-knob/type-wheel with reciprocal alphabet (type-wheel alphabet reversed to knob alphabet). By using a reciprocal encryption it was very easy to switch between enciphering and deciphering. The text was printed on a small paper ribbon. The compact device had the size of a small lunch box. Military personnel could put it in a side pocket of the uniform.

To encipher a letter the operator turned the alphabet knob to the desired letter and turned the handle at the right side of the machine. The type-wheel, fixed to the alphabet knob, then turned a number of steps, depending on the settings of the machine. The enciphered letter was printed on the paper ribbon or the operator could read off the reciprocal alphabet on the knob.

The wheel-pins were set each day according to a key sheet. Before each enciphering of a new message, the operator would set a new start position of the 5 pin-wheels on the exterior. The movable slide-bars on the drum contain fixed lugs. When the drum is revolved with the handle outside the machine, the different lugs pass 5 cams that are under control of the pins on the five pin-wheels. If a pin is active, the cam of that wheel will push a passing lug to the left. The slide-bar on which that lug is fixed will also move to the left and comes out of the drum as a small teeth.

US M-209

The left side of the drum will therefore act as a gear wheel with a variable number of teeth, engaging the type wheel. The number of tooth, and thus the displacement of the type wheel, depends on the settings of the lugs and pins. The 5 wheels had 17, 19, 21, 23 and 25 pins. Since these numbers have no common factor the same wheel setting would only occur once every 3,900,225 steps. On top of this, there were theoretically 10E29 different possibilities to set the many pins on the wheels.

An improved version with protective casing and another lug arrangement, and later on with movable lugs on the drum, was designated C-36 and. Its successor, the C-38, had six pinwheels. The lugs on this machine could slide on the drum bars in one of 5 active or an inactive position. This improvement, together with the larger wheel period, provided a very large key space. Another version, designated BC-543, was fitted with a keyboard.

In 1940 Hagelin went to the USA to promote his C Type machines which resulted in the largest sale ever of crypto machines. The US military selected his C-38 as tactical ciphering device and designated it as M-209. By the end of the Second World War over 140,000 of these small M-209 machines were produced in the US. You can also download our M-209 Simulator.

The C-52 and CX-52

Although the C-36 and C-38 were ideal for tactical purposes they were insufficient for the enciphering of high level message traffic that could resist extensive cryptanalysis. An improved version would open the door to the market of high level military and diplomatic encryption. Hagelin went back to the drawing table to improve his C Machines.

Several improvements were introduced in the C-52 model. The rotation of the pin-wheels became irregular. Whether a wheel moved or not on a given cycle depended on the pin positions of the previous wheels. For the 6 wheel model there was now the choice between 12 pin-wheels, with 25, 26, 29, 31, 34, 37, 38, 41, 42, 43, 46 and 47 pins. The number of slide-bars was increased to 32. A second type wheel was added to print both plain and ciphered text at the same time on a split paper ribbon and it was possible to set a relative position between the primary and secondary type wheel. Also, a type wheel with letters that could be rearranged became available. The later CX-52 model has 6 pinwheels with 47 pins each and a more flexible pinwheel advancing system as the C-52, resulting in a complex and highly irregular wheel movement.

Instead of developing a version with fixed keyboard like the BC-543 machine, the C-52 could be fitted with a separate keyboard attachment, called B-52 which included the electric motor to drive the drum of the C-52. The configuration with keyboard was designated BC-52. The very popular C-52, CX-52 and BC-52 were sold all over the world. See also our page with the technical details on the C-52 and CX-52 and you can download the BC-52 simulator.

The CX-52 RT has a tape reader to use of one-time tapes. Another development, based on the 52 series was the PEB machine designed to make enciphering easier for telex traffic. This was a combination of an adapted BC-52 model, called BC-621, connected to the PEB-61 tape punch and reader.

Image © D Rijmenants 2009

Hagelin CX-52
Image © Dirk Rijmenants

The Pocket Machines

On demand of the French Gendarmerie, a small pocket device was developed with the name CD-55. Two years later, the CD-57 was manufactured. Input and output consisted of a ring with an alphabet and a rotatable disk inside. The alphabet was displaced by pressing a lever with the thumb. The displacement depended on the setup of 6 small pin-wheels, similar to those used in the C Type machines. About 12,000 of these pocket models were sold to different countries. The CD-57 RT is has an option to use one-time tapes (random five bit punched tapes).

Hagelin goes On-line

After abandoning the TMX all-in-one Ciphering Teleprinter prototype, Hagelin decided in 1948 to develop the Telecrypto Machine, an on-line crypto device, connected between a standard teleprinter and the line, which could encipher and decipher the telex signals in real-time.

Image © John Alexander

Hagelin CD-57
Image © John Alexander

The first machine was designated T-52 and had 6 fixed pin-wheels and a drum with 2 x 12 slide-bars, similar to the C-36 model. The T-52 was produced in series between 1953 and 1954. Its successor, the T-55 used 6 interchangeable pin-wheels and a drum with 22 slide-bars, similar to the C-52 series. The T-55 had a tape reader that could be used to perform a superencipherment. This was a combination of the normal enciphering with a random one-time-tape. The T-55 was in production until 1956.

Prototypes and rare models

Hagelin did research on various types of mechanical encryptions and developed several different prototypes. One special version of the C Machine was the C-36 with Autokey, which had a second drum, connected via gears to the indicating disk. The device never came into production because of the problems, inherent to the Autokey system, to recover the message when an error during transmission occurred.

The TMX-53 was a ciphering teleprinter but its development was stopped as Crypto AG could not compete with major teleprinter firms. Instead, Crypto AG focused on the Telecrypto Machine which could be connected to standard teleprinter machines.

An advanced electromechanical cipher machine was developed and designated HX-63. The HX-63 had 9 rotors with 41 circuits of which the surplus wires were looped back on the outside (somewhat similar to the KL-7 ADONIS). All circuits could be rearranged and the rotors performed irregular movements like the C-52 series. All this provided an incredible key space of 10600. Manufacture of the HX-63 was abandoned due to the development of fully electronic cipher machines.

The CBI-53 was a random number generator with a printer, which used 40 type wheels and mixing chambers which held 26 steel balls of which one ball was a bit larger than the other 25 balls. After mixing, the balls were run into a tube until the thick ball blocked the tube. The number of balls in the tube was measured and determined the rotation of the type wheel.

Image © John Alexander

Hagelin HX-63
Image © John Alexander

More Hagelin Machines

Image © John Alexander

BC-38 (predecessor of BC-543)
Image © John Alexander

Image © John Alexander

C-446A (M-209 spin-off)
Image © John Alexander

Image © John Alexander

CX-52 with Punch Tape Reader
Image © John Alexander

Image © John Alexander

CX-EPX-1 Experimental Machine
Image © John Alexander

Image © John Alexander

H-4605 Off-Line System
Image © John Alexander

Image © John Alexander

H-4605 Open
Image © John Alexander

Image © John Alexander

HX-63 with its cover removed
Image © John Alexander

Image © John Alexander

© John Alexander


More on the history of the early Crypto AG machines is found in their 2009 Cryptomagazine .

Crypto AG from Electronic to Digital Era

Crypto AG kept playing a leading role in the development of new crypto systems after the transition from mechanical and electromechanical machines to fully electronic crypto equipment. In the 1970s, they developed the H-460 and H-4605 text encryption machines, the HC-500 CRYPTOMATIC series with the text encryption machines HC-550, HC-570, HC-580 and the HC-520 pocket device. In the 1980s came the HC-5205 Electronic Message Unit for use with radio and the HC-5700 Message Workstation.

Digitalization and the Internet brought new challenges and opportunities in the early 1990s. Crypto AG developed a range of network solutions such as the PSTN encrypted HC-2203 phone, HC-4221 fax encryption, the secure IP VPN Crypto Mobile Client HC-7835, Crypto Desktop HC-9300 and HA-2500 encrypted VoIP telephone.

They also developed various fixed and mobile military encryption system. Encrypted military IP Networks for HF, VHF and UHF, and secure satellite messaging systems, the SECOS radio series, MultiCom HC-2650 radio encryption and HC-2605 Terminal, the Crypto Field Terminal all-in-one messaging system and much more.

The magazine special 10th Anniversary of Cryptomagazine gives a good overview of their products and customers. All network solutions and radio equipment is found on the Crypto International AG website.

HC-2650 Radio and HC-2605 Terminal
Crypto International AG Products

Crypto AG Spy Scandal and Compromised Machines

The renowned Swiss-based crypto company, a world leader on commercial crypto equipment throughout the Cold War with customers in more than 120 countries, came under suspicion in the 1992 Hans Bühler case. Iran, one of the many countries using Crypto AG equipment, became suspicious after some of their secret communications had leaked. Bühler, a salesman for Crypto AG, was arrested in Iran, imprisoned and interrogated for nine months. This was only the tip of the iceberg.

* In 2014, declassified National Security Agency (NSA) documents showed a close cooperation between Boris Hagelin, founder of Hagelin Cryptos and Crypto AG, and his close friend William Friedman, the well-known brilliant U.S. cryptologist. Friedman's career included chief cryptologist of SIS, AFSA and NSA. Their 1950's gentlemen's agreement ensured that Boris Hagelin would only sell crypto machines to "questionable states" of which the message could be decrypted by NSA. This was achieved by either selling a less secure version of a machine, use modifications that weakened the encryption of a secure machine, or provide customer tailored manuals with less secure machine setting instructions. The Gentlemen's Agreement seemed to extend into the 1990's, as the Hans Bühler case showed. This cooperation between Crypto AG and NSA was big news in the cryptologic world.

Journalists from German television ZDF and American newspaper The Washington Post uncovered the last pieces of the puzzle in 2020. The CIA and the BND (Bundesnachrichtendienst, West-German Federal Intelligence Service) joint-purchased and took full control over Crypto AG already in 1970. This enabled the CIA, in cooperation with NSA, to develop unnoticeable weakened crypto equipment, sell these worldwide and eavesdrop on compromised communications across the globe for five decades. The documents also revealed that they not only sold compromised machines to "questionable states" but also to several NATO allies. This intelligence coup of the century, called operation RUBICON, eventually reached such proportions that the BND decided to pull out in 1993, making CIA the sole owner of Crypto AG.

In 2019, just before the CIA and BND ownership and operation RUBICON came to light, Crypto AG was liquidated and its assets temporarily transferred to The Crypto Group (TCG), later renamed into TCG Legacy AG. Two companies independently acquired part of the TCG assets. CyOne Security AG, led by three members of the Crypto AG board, took over the Swiss part and has the Swiss government as only customer.

Crypto International Group AB from Sweden took over the international branch and also acquired the brand name Crypto AG. The owner of Crypto International stated that they are a completely different company, until recently unaware of links between Crypto AG, CIA and BND. He planned to change the company name. However, with the export license suspended, the new owner had no other option than to dismiss virtually all employees in 2020 and the firm moved to Hünenberg. In July 2021 it was announced that the iconic Crypto AG building in the Zugerstrasse in Steinhausen would be demolished to make room for apartments.

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© Dirk Rijmenants 2004. Last changes: 30 November 2022

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