An attempt to break the encryption algorithm used in Microsoft's Xbox games console has been ditched for legal reasons, according to the project's organisers.

A prize of $100,000 was offered by the Neo Project to the first person to crack the main security code which the console uses to protect the hardware.

Obtaining the public key to the encryption would be a big step towards allowing people to run unauthorised software on the console.

The bid to break the encryption was launched by the group of computer enthusiasts using distributed computing techniques.

Distributed computing is a way breaking up huge tasks among a number of computers using processing power that would otherwise be left idle.

However, Mike Curry, one of the project's administrators, announced on the group's website that the project is now being shelved.

"Due to legal reasons, we will no longer be hosting or participating in the Xbox challenge," he said. "We will not be answering questions or commenting anymore on this subject."

As of Monday morning the website reported that 3,500 Neo users had eliminated over 776 million possible combinations. The Xbox uses a 2,048-bit public key to safeguard the console.

But, according to security experts, the chances of cracking the code were slim to non-existent.

A million Pentium 4 computers each running at 1GHz would take over 50 billion years to crack even a 1,640-bit key. Each extra bit on top of that doubles the amount of time needed to crack the code.

Solving the public key on the console could make it theoretically possible to crack the private key held by Microsoft, as they are mathematically linked to each other.

The private key is put onto each game to ensure that it is authorised to play on the console.

Microsoft was unable to comment at the time of going to press.