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In Windows XP and beyond, the user's RSA private key is backed up using an offline public key whose matching private key is stored in one of two places: the password reset disk (if Windows XP is not a member of a domain) or in the Active Directory (if Windows XP is a member of a domain). This means that an attacker who can authenticate to Windows XP as LocalSystem still does not have access to a decryption key stored on the PC's hard drive.
In Windows 2000, XP or later, the user's RSA private key is encrypted using a hash of the user's NTLM password hash plus the user name – use of a salted hash makes it extremely difficult to reverse the process and recover the private key without knowing the user's passphrase.
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