Alice is essentially sending plaintext and bob is encoding it via the random resistor configurations he chooses. Since the reciever controls the encryption, as

Alice is essentially sending plaintext and bob is encoding it via the random resistor configurations he chooses. Since the reciever controls the encryption, as dhx pointed out, you could just act as a man in the middle reading signals from alice on one circuit and forwarding them to bob on another, A & B would never be the wiser. Didn't read the paper yet but it also seems that without having many many resistors the number of signal states would be pretty low (bob's resistor count squared, assuming alice only has 2 resistors, i.e. a digital signal) making it rather trivial to extrapolate the original signal. Would this essentially rule out using this technique for encrypting a digital signal ?