A smart chip protection system contains a unique public/private identity key pair and uses a separate public/private signature key pair. The internally stored identity private key can not be read outside the chip. An issuing entity generates a descriptor containing the identity public key, attribute data, and a digital signature of the two, using a signature private key known only to the issuer. The authenticity of the descriptor is verified by decrypting the signature using the signature public key, and comparing the result to source data. An object's identity can be verified by requesting the smart chip to perform a data transformation using its identity private key, and performing the complement using the public key. An exemplary embodiment is a cellular telephone, in which a service provider verifies identity of the telephone and correct signature as a condition to providing service.