Securing AJAX Requests via GUID - ajax

I'm writing a web app that will be making requests via AJAX and would like to lock down those calls. After a little research, I am considering using some form of random token (string) to be passed back along with the request (GUID?). Here's the important parts of my algorithm:
Assign a token to a JavaScript variable (generated server-side).
Also, store that token in a DB and give it a valid time period (i.e. 10 minutes).
If the token has still not been used and is within it's valid time window, allow the call.
Return requested information if valid, otherwise, log the request and ignore it.
With an eye toward security, does this make sense? For the token, would a GUID work - should it be something else? Is there a good way to encrypt variables in the request?
EDIT:
I understand that these AJAX requests wouldn't be truly "secure" but I would like to add basic security in the sense that I would like to prevent others from using the service I intend to write. This random token would be a basic, front-line defense against abusive calls. The data that would be requested (and even submitted to generate such data) would is HIGHLY unlikely to be repeated.
Maybe I'm wrong in using a GUID... how about a randomly generated string (token)?

If you are doing this to trust code that you sent to the client browser, then change direction. You really don't want to trust user input, which includes calls from js that you sent to the browser. The logic on the server should be made so that nothing wrong can be done through there. That said, asp.net uses a signed field, you might want to go that way if absolutely necessary.
Expanding a bit:
Asp.net tamper-proofs the viewstate, which is sent as a html hidden field (depending on the configuration). I am sure there are better links as reference, but at least it is mentioned on this one: http://msdn.microsoft.com/en-us/library/ms998288.aspx
validation. This specifies the hashing
algorithm used to generate HMACs to
make ViewState and forms
authentication tickets tamper proof.
This attribute is also used to specify
the encryption algorithm used for
ViewState encryption. This attribute
supports the following options:
SHA1–SHA1 is used to tamper proof
ViewState and, if configured, the
forms authentication ticket. When SHA1
is selected for the validation
attribute, the algorithm used is
HMACSHA1.
A link for the .net class for that algorithm http://msdn.microsoft.com/en-us/library/system.security.cryptography.hmacsha1.hmacsha1.aspx.
Update 2:
For tamper-proofing you want to sign the data (not encrypt it). Note that when using cryptography in general, you should really avoid using a custom implementation or algorithm. Regarding the steps, I would stick to:
Assign a token to a JavaScript variable (generated server-side). You include info to identify the request and the exact date&time where it was issued. The signature will validate the server side application issued the data.
Identify double submits if appropriate.
That said, the reason asp.net validates the viewstate by default, is because devs rely on info coming in there as being handled only by the application when they shouldn't. The same probably applies for your scenario, don't rely on this mechanism. If you want to evaluate whether someone can do something use authentication+authorization. If you want to know the ajax call is sending only valid options, validate them. Don't expose an API at granularity level than the one where you can appropriately authorize the actions. This mechanism is just an extra measure, in case something slipped, not a real protection.
Ps. with the HMACSHA1 above, you would instantiate it with a fixed key

It really depends on what you're trying to accomplish by security. If you mean prevent unauthorized use of the HTTP endpoints there is very little you can do about it since the user will have full access to the HTML and JavaScript used to make the calls.
If you mean preventing someone from sniffing the data in the AJAX requests then I would just use SSL.
A GUID used in the way that you're suggesting is really just reinventing a session id cookie.

"Securing" is kind of a vague term. What exactly are you trying to accomplish? Using a GUID is a perfectly fine way to prevent duplicate submissions of the same request, but that is all.
If the information being passed between the client and server is truly sensitive, you should do it over HTTPS. That's really the only answer as far as securing the actual communication is concerned.
Edit: To answer your question regarding whether a GUID is the "right" way - there is no right way to do what you're suggesting. Using any token, whether it's a GUID or something of your own creation, will not have any effect other than preventing duplicate submissions of the same request. That's it.

Related

Recommended methods for jwt to kick people offline

I am searching for a long time on net. But no use. Please help or try to give some ideas how to achieve this.
I once used a method:
When generating the JWT token, add a fixed parameter as the salt generated by the token. If you want to kick a user offline, you only need to regenerate the value of the salt, and then verify the salt generated in the interceptor every time Whether the token is consistent with the token passed by the client! It can be judged whether this token has been hacked.
However, this method still stores certain data on the server side, which violates its statelessness. Is there any better way to implement it?
JWT's are not a great option when you need the ability to end a user session or log them out. In order to do that you need to track some sort of state.
https://developer.okta.com/blog/2017/08/17/why-jwts-suck-as-session-tokens
You can take a hybrid option though, and use a "stateless" option (JWT validation) for less critical operations, and do some sort of a "stateful" validation for others:
https://developer.okta.com/blog/2020/08/07/spring-boot-remote-vs-local-tokens
This post might not be what you are looking for, as this is more about a client validating tokens issued from an IdP, but it shows using JWT's for "read" requests (GET, HEAD, OPTIONS), and remote validation (OAuth 2) of the token for all other requests.

Does it make sense to put antiforgerytoken in _Layout.cshtml?

I'm developing an ASP.NET MVC application and I'm planing to protect each non GET request (POST, PUT, DELETE, etc...) with AntiForegeryToken.
I've implemented an extension of the classical AntiForgery verification based on the [__RequestVerificationToken] sent in the header. This because most of my calls are async ($.ajax()) and it turns out easier for me to send the hidden field value that way.
Does it make sense to put one single #Html.AntiForgeryToken() in the _Layout.cshtml (template for all pages) and always refer to that one only ?
I've tryed to understand what wolud be different beteen this option and putting it in each form (that I don't use much since my requests are pretty much all async), but I haven't.
Can anyone clear this to me ?
Thanks
Lorenzo
You can put it in your _Layout.cshtml and generate a single token when the page is rendered, that's fine.
While there is a very slight security benefit of using a different token for every request, if your token has enough entropy (and the standard token generated by #Html.AntiForgeryToken() does), then it is practically infeasible for an attacker to guess the token even during the time of a user session. So one token per user session is still considered secure in most cases.
Actually, trying to use a new token for each request leads to all kinds of bugs in a Javascript heavy application, because the browser needs a non-neglectible time to actually change things like a cookie value or to send a request, and frequent ajax requests will lead to a race condition and you will have hard to debug bugs around token mismatches.
ASP.NET MVC still focuses on traditional form-based applications in this regard, and while you can use it to prevent CSRF in modern Javascript-heavy apps with some tweaks (like a custom attribute to actually verify a token sent in request headers), you do have to write some custom code to do that. Hopefully Microsoft will add built in support in future versions.
UPDATE
After implementing the solution with #Html.AntiForgeryToken() directly in Template page (_Layout.cshtml) I found out a possible problem bound to the use of custom Claims. The problem happens during re-validation of UserIdentity. As a reference I'll leave the link to another post in which I've been dealing with that and added there the wotrkaround for those who choose the same implementation.
Custom Claims lost on Identity re validation
Hope it helps !

Protect Web API from unauthorized applications

I am working on a web page that uses a lot of AJAX to communicate with the server. The server, in turn, has an extensive REST/JSON API exposing the different operations called by the web client.
This web site is used by both anonymous and authenticated users. As you might expect, the web service calls issued by authenticated users require authentication, and are thus protected from unauthorized users or applications.
However, the web site has a lot of features that require no authentication, and some of these make use of anonymous web services. The only way I am using to prevent outsiders from calling this web services is by using a CSRF token. I know, the CSRF token is not very useful in this regard... with some time in hand, you can figure out how to consume the web services even if they use a CSRF token.
Of course, you can use a CAPTCHA to prevent applications or bots from autonomously using your web service. However, any human will be able to use it.
Sharing a secret key between client and server, on the other side, would be useless. This, because of the ability of any outsider to read it from the web page source code.
I would like to make these web services as difficult to invoke as posible to any 3rd party application. What would you do besides using the CSRF token? It sounds a little stupid, but hey, maybe it is stupid and I am just losing my time.
Note: given this application uses a browser and not an "executable" as the client, this question is irrelevant to the discussion. I cannot use a secret between server and client (not to my knowledge, at least)
I would take a few steps.
Force https on the site. Automatically redirect any incoming http requests to https ones (the RequireHttps attribute is handy for this)
Each page needs to (securely, hence the https) send a one-time use token to the client, to be used for the page. The script running on the client can hold this in the page memory. Any request coming back sends a hashed & salted response, along with the nonce salt. The server can repeat the steps with the saved token + salt and hash to confirm the request. (much like explunit's answer above)
(It's worth noting that the secure request from a client isn't being authenticated from a user account, merely a token sent with the full page.)
The definition for one-time could either be session or page load, depending on your security vs convenience preference. Tokens should be long and expired fairly quickly to frustrate attackers.
The SSL + Hash(token + nonce) should be enough for your needs.
This is interesting. Below is a crazy suggestion. Remember, your question is also equally crazy.
Your website, once opened through a browser, should generate a long polling connection (Comet programing). This will create a unique session between the browser and the server. When ur JS is making the ajax call, send some token (unique token every time) to the server through the long polling thread. Let the AJAX also send the same token. At the server, get the AJAX token and check whether you have a similar token in you long polling session. If yes, fulfill the request. Any coder can break this. But, it won't be easy. Chances are the freeboarders won't even see these second piece of comet code. You can implement the comet code in such a way it is not easy to detect or understand. When they call ur service, send a 'Service Unavailable' message. They will be confused. Also make the comet code https.
You can also check how long that long polling thread is open. If the session was just opened and you get a ajax call right away, you can assume it is a 3rd party call. It depends on ur website flow. If ur Ajax call happens after 1 second of page load, you can check for that pattern on server side.
Anyone coding for your public api, will have 1 to 2 secret checks that they wouldn't even know and even if they know, they might be discouraged by all the extra coding they have to do.
You might have an easier problem than the one described in the linked question since you don't need to distribute a binary to the users. Even if your app is open source, the HMAC/signature key (in the "Request Signatures" part of that answer) can be controlled by an environment/configuration setting.
To summarize:
The secret key is not actually sent between client and server. Rather, it's used to sign the requests
Be sure that the requests include some unique/random element (your CSRF key probably suffices) so that two requests for the same API data are not identical.
Sign the request with the secret key and append the signature to the request. You linked to a PHP question but not clear if what language you're using. In .Net I would use a HMAC class such as HMACSHA256.
On the API server-side use the same HMAC object to verify that the request was signed with the same secret key.
Maybe you could use counters to keep track of conversations. Only the Server and Clients will be able to predict the next iteration in a conversation. This way, I think, you can prevent third party applications to impersonate someone (Just an idea though).
At the beginning, they start talking at some iteration (i=0, for example).
Every time the client requests something, the counter is incremented by some number in both the server side and the client (i=i+some_number).
And, after a few minutes of no communication, they both know they have to reset the counter (i=0).
This is just an idea based on the concept of RSA and also placing Fraud Detection on your system. The Risk from Authorized users is minimal however they can attempt to make anonymous calls to your web-service too.
For UN-Authorised users : For each web-service call , generate a token say using RSA which changes after some time(can be configured say 30 min). This way prediction of code is minimized. I have not heard of RSA collision till now. Send this token back to the user for his browser session. For further security , we might want to attach a session id with RSA token. Since session ids are unique new anonymous calls would require new session id.
Calls can be tracked using Auditing mechanism. Also per-web service there can be a different RSA setup. How the Algorithm for Fraud Detection would work is a challenge by itself.
For Authorized Users :
Every user should be tracked by his IP Address using Header block. The RSA token principle can be applied.
The solution is very vague but worth considering.

Do sessions really violate RESTfulness?

Is using sessions in a RESTful API really violating RESTfulness? I have seen many opinions going either direction, but I'm not convinced that sessions are RESTless. From my point of view:
authentication is not prohibited for RESTfulness (otherwise there'd be little use in RESTful services)
authentication is done by sending an authentication token in the request, usually the header
this authentication token needs to be obtained somehow and may be revoked, in which case it needs to be renewed
the authentication token needs to be validated by the server (otherwise it wouldn't be authentication)
So how do sessions violate this?
client-side, sessions are realized using cookies
cookies are simply an extra HTTP header
a session cookie can be obtained and revoked at any time
session cookies can have an infinite life time if need be
the session id (authentication token) is validated server-side
As such, to the client, a session cookie is exactly the same as any other HTTP header based authentication mechanism, except that it uses the Cookie header instead of the Authorization or some other proprietary header. If there was no session attached to the cookie value server-side, why would that make a difference? The server side implementation does not need to concern the client as long as the server behaves RESTful. As such, cookies by themselves should not make an API RESTless, and sessions are simply cookies to the client.
Are my assumptions wrong? What makes session cookies RESTless?
First of all, REST is not a religion and should not be approached as such. While there are advantages to RESTful services, you should only follow the tenets of REST as far as they make sense for your application.
That said, authentication and client side state do not violate REST principles. While REST requires that state transitions be stateless, this is referring to the server itself. At the heart, all of REST is about documents. The idea behind statelessness is that the SERVER is stateless, not the clients. Any client issuing an identical request (same headers, cookies, URI, etc) should be taken to the same place in the application. If the website stored the current location of the user and managed navigation by updating this server side navigation variable, then REST would be violated. Another client with identical request information would be taken to a different location depending on the server-side state.
Google's web services are a fantastic example of a RESTful system. They require an authentication header with the user's authentication key to be passed upon every request. This does violate REST principles slightly, because the server is tracking the state of the authentication key. The state of this key must be maintained and it has some sort of expiration date/time after which it no longer grants access. However, as I mentioned at the top of my post, sacrifices must be made to allow an application to actually work. That said, authentication tokens must be stored in a way that allows all possible clients to continue granting access during their valid times. If one server is managing the state of the authentication key to the point that another load balanced server cannot take over fulfilling requests based on that key, you have started to really violate the principles of REST. Google's services ensure that, at any time, you can take an authentication token you were using on your phone against load balance server A and hit load balance server B from your desktop and still have access to the system and be directed to the same resources if the requests were identical.
What it all boils down to is that you need to make sure your authentication tokens are validated against a backing store of some sort (database, cache, whatever) to ensure that you preserve as many of the REST properties as possible.
I hope all of that made sense. You should also check out the Constraints section of the wikipedia article on Representational State Transfer if you haven't already. It is particularly enlightening with regard to what the tenets of REST are actually arguing for and why.
First, let's define some terms:
RESTful:
One can characterise applications conforming to the REST constraints
described in this section as "RESTful".[15] If a service violates any
of the required constraints, it cannot be considered RESTful.
according to wikipedia.
stateless constraint:
We next add a constraint to the client-server interaction:
communication must be stateless in nature, as in the
client-stateless-server (CSS) style of Section 3.4.3 (Figure 5-3),
such that each request from client to server must contain all of the
information necessary to understand the request, and cannot take
advantage of any stored context on the server. Session state is
therefore kept entirely on the client.
according to the Fielding dissertation.
So server side sessions violate the stateless constraint of REST, and so RESTfulness either.
As such, to the client, a session cookie is exactly the same as any
other HTTP header based authentication mechanism, except that it uses
the Cookie header instead of the Authorization or some other
proprietary header.
By session cookies you store the client state on the server and so your request has a context. Let's try to add a load balancer and another service instance to your system. In this case you have to share the sessions between the service instances. It is hard to maintain and extend such a system, so it scales badly...
In my opinion there is nothing wrong with cookies. The cookie technology is a client side storing mechanism in where the stored data is attached automatically to cookie headers by every request. I don't know of a REST constraint which has problem with that kind of technology. So there is no problem with the technology itself, the problem is with its usage. Fielding wrote a sub-section about why he thinks HTTP cookies are bad.
From my point of view:
authentication is not prohibited for RESTfulness (otherwise there'd be little use in RESTful services)
authentication is done by sending an authentication token in the request, usually the header
this authentication token needs to be obtained somehow and may be revoked, in which case it needs to be renewed
the authentication token needs to be validated by the server (otherwise it wouldn't be authentication)
Your point of view was pretty solid. The only problem was with the concept of creating authentication token on the server. You don't need that part. What you need is storing username and password on the client and send it with every request. You don't need more to do this than HTTP basic auth and an encrypted connection:
Figure 1. - Stateless authentication by trusted clients
You probably need an in-memory auth cache on server side to make things faster, since you have to authenticate every request.
Now this works pretty well by trusted clients written by you, but what about 3rd party clients? They cannot have the username and password and all the permissions of the users. So you have to store separately what permissions a 3rd party client can have by a specific user. So the client developers can register they 3rd party clients, and get an unique API key and the users can allow 3rd party clients to access some part of their permissions. Like reading the name and email address, or listing their friends, etc... After allowing a 3rd party client the server will generate an access token. These access token can be used by the 3rd party client to access the permissions granted by the user, like so:
Figure 2. - Stateless authentication by 3rd party clients
So the 3rd party client can get the access token from a trusted client (or directly from the user). After that it can send a valid request with the API key and access token. This is the most basic 3rd party auth mechanism. You can read more about the implementation details in the documentation of every 3rd party auth system, e.g. OAuth. Of course this can be more complex and more secure, for example you can sign the details of every single request on server side and send the signature along with the request, and so on... The actual solution depends on your application's need.
Cookies are not for authentication. Why reinvent a wheel? HTTP has well-designed authentication mechanisms. If we use cookies, we fall into using HTTP as a transport protocol only, thus we need to create our own signaling system, for example, to tell users that they supplied wrong authentication (using HTTP 401 would be incorrect as we probably wouldn't supply Www-Authenticate to a client, as HTTP specs require :) ). It should also be noted that Set-Cookie is only a recommendation for client. Its contents may be or may not be saved (for example, if cookies are disabled), while Authorization header is sent automatically on every request.
Another point is that, to obtain an authorization cookie, you'll probably want to supply your credentials somewhere first? If so, then wouldn't it be RESTless? Simple example:
You try GET /a without cookie
You get an authorization request somehow
You go and authorize somehow like POST /auth
You get Set-Cookie
You try GET /a with cookie. But does GET /a behave idempotently in this case?
To sum this up, I believe that if we access some resource and we need to authenticate, then we must authenticate on that same resource, not anywhere else.
Actually, RESTfulness only applies to RESOURCES, as indicated by a Universal Resource Identifier. So to even talk about things like headers, cookies, etc. in regards to REST is not really appropriate. REST can work over any protocol, even though it happens to be routinely done over HTTP.
The main determiner is this: if you send a REST call, which is a URI, then once the call makes it successfully to the server, does that URI return the same content, assuming no transitions have been performed (PUT, POST, DELETE)? This test would exclude errors or authentication requests being returned, because in that case, the request has not yet made it to the server, meaning the servlet or application that will return the document corresponding to the given URI.
Likewise, in the case of a POST or PUT, can you send a given URI/payload, and regardless of how many times you send the message, it will always update the same data, so that subsequent GETs will return a consistent result?
REST is about the application data, not about the low-level information required to get that data transferred about.
In the following blog post, Roy Fielding gave a nice summary of the whole REST idea:
http://groups.yahoo.com/neo/groups/rest-discuss/conversations/topics/5841
"A RESTful system progresses from one steady-state to the
next, and each such steady-state is both a potential start-state
and a potential end-state. I.e., a RESTful system is an unknown
number of components obeying a simple set of rules such that they
are always either at REST or transitioning from one RESTful
state to another RESTful state. Each state can be completely
understood by the representation(s) it contains and the set of
transitions that it provides, with the transitions limited to a
uniform set of actions to be understandable. The system may be
a complex state diagram, but each user agent is only able to see
one state at a time (the current steady-state) and thus each
state is simple and can be analyzed independently. A user, OTOH,
is able to create their own transitions at any time (e.g., enter
a URL, select a bookmark, open an editor, etc.)."
Going to the issue of authentication, whether it is accomplished through cookies or headers, as long as the information isn't part of the URI and POST payload, it really has nothing to do with REST at all. So, in regards to being stateless, we are talking about the application data only.
For example, as the user enters data into a GUI screen, the client is keeping track of what fields have been entered, which have not, any required fields that are missing etc. This is all CLIENT CONTEXT, and should not be sent or tracked by the server. What does get sent to the server is the complete set of fields that need to be modified in the IDENTIFIED resource (by the URI), such that a transition occurs in that resource from one RESTful state to another.
So, the client keeps track of what the user is doing, and only sends logically complete state transitions to the server.
As I understand, there are two types of state when we are talking about sessions
Client and Server Interaction State
Resource State
Stateless constraint here refers to the second type in Rest. Using cookies (or local storage) does not violate Rest since it is related to the first.
Fielding says: 'Each request from client to server must contain all of the information necessary to understand the request, and cannot take advantage of any stored context on the server. Session state is therefore kept entirely on the client.'
The thing here is that every request to be fulfilled on the server needs the all necessary data from the client. Then this is considered as stateless. And again, we're not talking about cookies here, we're talking about resources.
HTTP transaction, basic access authentication, is not suitable for RBAC, because basic access authentication uses the encrypted username:password every time to identify, while what is needed in RBAC is the Role the user wants to use for a specific call.
RBAC does not validate permissions on username, but on roles.
You could tric around to concatenate like this: usernameRole:password, but this is bad practice, and it is also inefficient because when a user has more roles, the authentication engine would need to test all roles in concatenation, and that every call again. This would destroy one of the biggest technical advantages of RBAC, namely a very quick authorization-test.
So that problem cannot be solved using basic access authentication.
To solve this problem, session-maintaining is necessary, and that seems, according to some answers, in contradiction with REST.
That is what I like about the answer that REST should not be treated as a religion. In complex business cases, in healthcare, for example, RBAC is absolutely common and necessary. And it would be a pity if they would not be allowed to use REST because all REST-tools designers would treat REST as a religion.
For me there are not many ways to maintain a session over HTTP. One can use cookies, with a sessionId, or a header with a sessionId.
If someone has another idea I will be glad to hear it.
i think token must include all the needed information encoded inside it, which makes authentication by validating the token and decoding the info
https://www.oauth.com/oauth2-servers/access-tokens/self-encoded-access-tokens/
No, using sessions does not necessarily violate RESTfulness. If you adhere to the REST precepts and constraints, then using sessions - to maintain state - will simply be superfluous. After all, RESTfulness requires that the server not maintain state.
Sessions are not RESTless
Do you mean that REST service for http-use only or I got smth wrong? Cookie-based session must be used only for own(!) http-based services! (It could be a problem to work with cookie, e.g. from Mobile/Console/Desktop/etc.)
if you provide RESTful service for 3d party developers, never use cookie-based session, use tokens instead to avoid the problems with security.

Is this a good security strategy?

I'm trying to make a web service secure.
It's not for a bank or anything of that sort, but the organization using it may lose some money if the service will be used by someone not authorized (it's hard to tell exactly how much..).
The purpose is not to allow unauthorized applications to use any method (other than "GetChallenge". for users authentication there is a different mechanism which checks for username and password. I actually combined the two, but they serve different purposes):
So here's what I do:
I send a (ASP.NET) session key (for everyone to read. ASP.NET's session Is 15 randomly generated bytes, it lives for 20 minutes unless prolonged, and ASP.NET will not receive any request without it).
In my SignIn method, apart from username and password (which anyone can acquire, since it's a part of a public site), I receive a third parameter - the session key hashed by md5 algorithm with 6 bytes as salt.
And only if the hash is correct (I'm hashing and comparing it on the server side) - I let the users sign in.
From then on in every method, I check if the user is signed in.
Added: The username and password are sent as clear text, and that's not a problem (not the one I'm addressing at least). The problem is for someone (other than the company we're working with) writing an application which uses my web service. The web service should only be used by an authorized application.
Also, the session id is sent back and forth with every request and response (as a part of ASP.NET session mechanism. That's how ASP.NET knows to "track" a session specific for a user). Sorry for not clarifying that from the first place.
(irrationally thought it was obvious).
How strong and effective is that security strategy?
Thanks.
Updated based on your edit and comment
It's pretty secure and is very similar to the approach used by Google, Facebook and others for their API keys. Except...
Session ID plain text potential issue
I would recommend against using Session ID as part of a security mechanism.
The one issue is with passing the session key in plain text across the network. There is potential that this could open up some Session hijack and other attacks.
From the Microsoft Docs:
The SessionID is sent between the server and the browser in clear text, either in a cookie or in the URL. As a result, an unwanted source could gain access to the session of another user by obtaining the SessionID value and including it in requests to the server. If you are storing private or sensitive information in session state, it is recommended that you use SSL to encrypt any communication between the browser and server that includes the SessionID.
As you are using the Session ID as part of your security mechanism I would say that is sensitive data.
One way to ensure someone doesn't get hold of your session key is to run your service on HTTPS. Personally I would avoid using the Session ID in this way and generating a non-related value instead.
Recommended change
Follow more closely the model used by Google and the like. Generate a new GUID for each application, store the GUID in a database on the server, pass the GUID in each request to your server from the client.
Benfits:
Identifies the client application uniquely, allowing you to track and manage usage per client nicely
Easily disable any client by removing the GUID from your data store
No sensitive data on the wire
I would still run the service on HTTPS as it's easy to setup and gives the added benefit of protecting any other data you send to your service.
The purpose of encryption is not to
allow unauthorized applications to use
any method
Wrong. The purpose of encryption it to prevent the understanding of data whilst either in transit or stored. It prevents data being 'useable' by those that do not have the means to decrypt.
What you are describing is something similar to a public/private key system. You're making your session key available to everyone. Then only after they've md5 with the correct salt (as per your server side comparison) you're then trusting that source.
You've got NO authentication here except for username and password. Also your data isn't encrypted during transit. I fail to see how this is at all secure.
I think you're best bet is to use an SSL certificate (so your web service is running over HTTPS) along with the username and password. If you want to be doubly secure you might want to go down the route of checking source IP ranges and login locations as an additional check. Perhaps a forced password change interval will help in the case that consumers are passing credentials to a third party + audit how the web service is actually being used.
As a side note if you want to hash something don't use MD5, its broken.
From a web services perspective the ideal way to use authentication or provide security to your service is something like this: Web Service Authentication (Token and MD5 Hashing to encrypt password).
The way you describe it, it does not seem secure at all.
What is the point of letting the SignIn method accept a hashed session key, if the session key is public ("for everyone to read")?
Plus: "in every method, I check if the user is signed in. " How do you check that?
A common (and reasonably secure) strategy would be to generate a (unique, sufficiently long and random) session ID server-side, and send it to the client after it has authenticated. Then check every client request and only accept it if it contains the session ID. To do this, either embed the ID into all links on every page, or set it as a cookie, depending on what's easier for you.
On logout, just delete the session ID on the server.
That way, no one can invoke any method without a valid session.

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