Let's say that I have two routers, RouterA and RouterB. If RouterA is in the periphery and wants to access RouterB in the central office, this is analogous to a client server model where RouterA is the client and RouterB is the server. I realise that RouterB will send the challenge and, if RouterA's response is correct, RouterB will allow the authentication and data transfer.
What if I have two routers in a lab, connected by a serial DCE/DTE cable? If I have them configured correctly with CHAP, how do they decide which one issues the challenge to the other? Does one become "dominant" and, if so, how? Is it like OSPF priority and based upon IP addresses or is it simply the first one to send the challenge that takes the lead?
A supplementary question is do the routers authenticate each other in both directions:
1. RouterA sends challenge to RouterB, which responds correctly and RouterA accepts that RouterB is what it's supposed to be, then
2. RouterB sends a challenge to RouterA, which responds correctly and RouterB accepts that RouterA is what it's supposed to be, hence allowing data transfer in both directions.