This paper presents a new approach for the secure and robust copyright protection of digital images. A system for generating digital watermarks and for trading watermarked images is described. The system is based on a new watermarking technique, which is robust against image transformation techniques such as compression, rotation, translation, scaling and cropping. It uses modulation of the magnitude components in Fourier space to embed a watermark and an accompanying template. During the watermark extraction,the template is read in the log polar transform of the frequency domain. The template is used for analyzing scaling and rotation suffered by the watermarked stego-image. The detection of the watermarks is also possible without any need for the original cover-image. In addition, the system applies asymmetric cryptographic protocols for different purposes, namely embedding/detecting the watermark and transferring watermarked data. The public key technique is applied for the construction of a one-way watermark embedding and the verification function to identify and prove the uniqueness of the watermark. Legal dispute resolution is supported for the multiple watermarking of a digital image without revealing the confidential keying information.