As well as fiat, cryptocurrencies need to be stored securely. That’s what we need these keys for. In this article, we will tell you what private and public keys are and how they are used.
What are private keys?
A private key is a number that is encoded in different formats depending on which wallet you are using. In each format, the private key looks like a set of randomly generated numbers and symbols. All of these formats represent the same private key, even if they look different. Any format is easy to convert to another. A private key is an important thing for controlling your cryptocurrency wallet. Only with a private key that matches your public key (address), you can unlock your funds or transfer funds to another user. Public and private keys are inseparable, their relationship is based on mathematical functions. They are combined into a complex irreversible algorithm.
What are public keys?
A public key is a unique address used in the blockchain. Each member of the network can see it. It is a combination of letters and numbers generated from a private key that identifies the sender or recipient of the funds. Usually, when you open a wallet, a public key is generated, which begins with a certain number. But there is an improved version of the public key with multi-signature, it starts with a triple, and in order to get to the coins, you must provide more than one private key.
Why is there no doubt about the security of private keys?
Cryptocurrency owners often offer to increase the length of the keys to protect themselves from hacker attacks from supercomputers that have not yet invented, or to eliminate the luck factor. Not everyone understands that even the greatest luck will not help.
The key is randomly generated from numbers and letters. A possible number of private keys is 10⁷⁷. To sort out all the possible private keys, you need to spend all the energy that the sun produces for 32 years, or make all the computers on the planet work for billions of years. Even if you sit around all your life creating keys with addresses, you’ll never find an address you’re already using.
You can lose money only if your private key gets into the hands of criminals. The most common ways to steal private keys are through storage media and communication channels. But it is impossible to find a loophole in the tool itself.
As a rule, users do not notice the process of generating, using and storing private keys. But the private key can be seen. One of the easiest and safest ways to do this is to create a paper wallet. You generate and print on paper your keys — private and public — and hide them in a safe place.
The keys are printed as QR codes, which when scanned open access to all your transactions. This is safe because you, the user, are in full control of your wallet. The only thing you need to do is to ensure the safety of a sheet of paper.