HDLC (High-Level Data Link Control) is a Layer 2 WAN Encapsulation Protocol that is used on syncronous data links. It is the simplest WAN Protocol that can connect your remote offices over leased lines.
HDLC has two versions. One of them is the standard one and the other is the Cisco proprietary version. The frame of standard version and Cisco proprietary version is similar. Only in Cisco proprietary HDLC, there is one additional proprietary field. Below, both frame is showed:
Cisco HDLC is the default enabled WAN protocol of Cisco for Point to Point WAN links. And Cisco HDLC can be used only between Cisco devices. Other vendor devices can not use Cisco HDLC.
Lastly, there is no Authentication mechanims in HDLC. So, security is a concern for this WAN protocol.
PPP (Point to Point Protocol) is also a WAN Encapsulation Protocol that is based on HDLC but we can say that it is the enhanced version of HDLC. There are many additional features in PPP if we compare with HDLC.
PPP supports two Authentication Protocols. These Authentication Protocols are:
• PAP (Password Authentication Protocol)
• CHAP (Challenge Handshake Authentication Protocol)
PAP (Password Authentication Protocol) is the simplest Authentication method. It uses 2-way handshake. The passwords are sent as clear text in this method. And passwords are exchanged only at the beginning.
CHAP (Challenge Handshake Authentication Protocol) is the more complex Authenticaion method. CHAP uses 3-way handshake and with this mechanims it checks the remote node periodically. CHAP uses MD5 hash. Hash is sent to other node and the other node also sent a hash. If the hashes are same, then the communication is accepted.