Quantum key distribution (QKD) is a method for establishing secure cryptographic keys between two parties who share an optical, "quantum" channel and an authenticated classical channel. To share such keys across the globe, space-based links are required and in the near term these will take the form of trusted node, key management satellites. We consider such channels between two nanosatellite spacecraft for polarization entanglement-based QKD, and the optical channel is described in detail. Quantum channels between satellites are useful for balancing keys within constellations of trusted node QKD satellites and, in the future, may have applications in long-distance qubit exchange between quantum computers and in fundamental physics experiments. The nanosatellite mission proposed uses an optical link with 80-mm diameter optical terminals. If such a link could be maintained with 10-μrad pointing accuracy, then this would allow QKD to be performed for satellite separations up to around 400 km. A potential pointing and tracking system is also described although currently this design would likely limit the satellite separation to 100 to 150 km.
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