Droplets of one liquid suspended in a second, immiscible liquid move through a microfluidic device in which a channel splits into two branches that reconnect downstream. The droplets choose a path based on the number of droplets that occupy each branch. The interaction among droplets in the channels results in complex sequences of path selection. The linearity of the flow through the microchannels, however, ensures that the behavior of the system can be reversed. This reversibility makes it possible to encrypt and decrypt signals coded in the intervals between droplets. The encoding/decoding device is a functional microfluidic system that requires droplets to navigate a network in a precise manner without the use of valves, switches, or other means of external control.