The story
Founded by Boris Hagelin in 1952.1
Crypto AG was established in Switzerland by the Russian-born Swede, Boris Hagelin. Originally called AB Cryptoteknik and founded by Arvid Gerhard Damm in Stockholm in 1920, the firm manufactured the C-36 mechanical cryptograph machine that Damm had patented. After Damm's death, and just before the Second World War, Cryptoteknik came under the control of Hagelin, an early investor.
Hagelin's hope was to sell the device to the United States Army. When Germany invaded Norway in 1940, he moved from Sweden to the US and presented the device to the military, which in turn brought the device to the Signal Intelligence Service, and the code-breakers in Arlington Hall. In the end he was awarded a licensing agreement. 140,000 units were made during the war for US troops.
During his time in United States, Hagelin became close friends with William F. Friedman, who in 1952 became chief cryptologist for the NSA, and whom Hagelin had known since the 1930s. The same year, Hagelin's lawyer, Stuart Hedden, became deputy commander in CIA, Inspector General.
In 1948, Hagelin moved to Steinhausen in Switzerland to avoid taxes. In 1952 the company, which until then had been incorporated in Stockholm, also moved to Switzerland. The official reason was that it was transferred as a result of a planned Swedish government nationalisation of militarily important technology contractors. A holding company was set up in Liechtenstein.
During the 1950s, Hagelin and Friedman had frequent mail correspondence, both personal and business alike. Crypto AG sent over new machines to the NSA and they had an ongoing discussion concerning which countries they would or would not sell the encryption systems to, and which countries to sell older, weaker systems. In 1958 when Friedman retired, Howard C. Barlow, a high-ranking NSA employee, and Lawrence E. Shinn, NSA's signal intelligence directory in Asia, took over the correspondence.
In June 1970, the company was bought in secret by the CIA and the West-German intelligence service, BND, for US$5.75 million (equivalent to $48M or €42.5M in 2025). This was effectively the start of Operation Rubikon. Hagelin had first been approached to sell to a partnership between the French and West-German intelligence services in 1967, but Hagelin contacted the CIA and the US did not cooperate with the French. At this point, the company had 400 employees and the revenue increased from 100,000 Swiss franc in the 1950s to 14 million Swiss franc in the 1970s.
In 1994, Crypto AG bought InfoGuard AG a company providing encryption solutions to banks.
In 2010, Crypto AG sold G.V. LLC, a Wyoming company providing encryption and interception solutions for communications.
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In 2018, Crypto AG was liquidated, and its assets and intellectual property sold to two new companies. CyOne was created for Swiss domestic sales, while Crypto International AG was founded in 2018 by Swedish entrepreneur Andreas Linde, who acquired the brand name, international distribution network, and product rights from the original Crypto AG. InfoGuard AG became the property of the management as part of a management buyout.
In 2020, it was established following a parliamentary investigation that the Swiss government and its intelligence services were aware of the spying activities of Swiss-based Crypto for many years and had "benefited from the US-led spying".
The company and its history were the subject of BBC Radio 4's Archive on 4 programme in May 2021.
From Wikipedia’s article on Crypto AG, shared under CC BY-SA 4.0.4