Cryptocurrencies What are a private and public keys for

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What are Address, Private Key, Public Key, and Passphrase?

Address, private key, public key, and passphrase are frequently used and closely related concepts in the blockchain technologies/cryptocurrencies that can be confusing to many people. Now let’s make them clear.

Address

We are familiar with Bitcoin addresses. They are a sequence of letters and digits like 171gLtPSHdVXdKjeiG786WmeAyTVWXFA4q . Just like your email address can receive emails, it can receive cryptos from others. It is often represented as a QR code so mobile phones can read easily. E.g. the following QR code shows the aforementioned address.

Passphrase

A passphrase, sometimes referred to as mnemonic passphrase or seed, is usually a sequence of randomly generated English words like the following, which is mainly used for generating and recovering an entire crypto wallet.

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For example, the widely used Bitcoin desktop wallet electrum provides an easy to use interface to generate a 12 words passphrase and then forces you to backup it securely.

Also, if you lose your wallet, you can recover it through the interface easily with the passphrase.

Public key

Every normal Bitcoin address has a public key. They are not very visible to normal users but are used on the blockchain whenever you send Bitcoins. Using the electrum wallet, you can check the public key of your address by switching to the Addresses tab, and then right click at an address and then choose Details. The following shows the public key of the address 171gLtPSHdVXdKjeiG786WmeAyTVWXFA4q

Private key

Private keys are generated either randomly or deterministically from a passphrase. Every private key can generate an address. Using electrum, we can also check an address’s private key by switching to the Addresses tab, and then right click at an address and then choose Private key. The following picture shows the private key of the address 171gLtPSHdVXdKjeiG786WmeAyTVWXFA4q . Losing the private key means losing your cryptos in that address. So keep it safe.

Conclusion

  • A passphrase can generate a wallet that contains many private keys.
  • Every private key has a corresponding public key and address.
  • Losing a private key means losing the cryptos in that address.
  • Losing the passphrase means losing the entire wallet.

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Private Key

What Is a Private Key?

A private key is a sophisticated form of cryptography that allows a user to access his or her cryptocurrency. A private key is an integral aspect of bitcoin and altcoins, and its security make up helps to protect a user from theft and unauthorized access to funds.

Understanding Private Key

When dealing with cryptocurrency, a user is usually given a public address and a private key to send and receive coins or tokens. The public address is where the funds are deposited and received. But even though a user has tokens deposited into his address, he won’t be able to withdraw them without the unique private key. The public key is created from the private key through a complicated mathematical algorithm. However, it is near impossible to reverse the process by generating a private key from a public key.

The private key can take a few different forms, usually depicted as a series of alphanumeric characters, which makes it hard for a hacker to crack. Most users represent their wallet keys in wallet import format, which has 51 characters. Think of a public address as a mailbox, and the private key as the key to the box. The mailman, and anyone really, can insert letters and small packages through the opening in the mailbox. However, the only person that can retrieve the contents of the mailbox is the one that has the unique key. It is, therefore, important to keep the key safe because if it is stolen or gotten without authorization, the mailbox can be compromised.

A digital wallet stores the private key of a user. When a transaction is initiated, the wallet software creates a digital signature by processing the transaction with the private key. This upholds a secure system since the only way to generate a valid signature for any given transaction is to use the private key. The signature is used to confirm that a transaction has come from a particular user, and ensures that the transaction cannot be changed once broadcasted. If the transaction gets altered, even slightly, the signature will change as well.

If a user loses his/her private key, s/he can no longer access the wallet to spend, withdraw, or transfer coins. It is, therefore, imperative to save the private key in a secure location. There are a number of ways that a digital wallet which contains a private key can be stored. Private keys can be stored on paper wallets which are documents that have been printed with the private key and QR code on them so that it can easily be scanned when a transaction needs to be signed.

The private keys can also be stored using a hardware wallet which uses smartcards or USB devices to generate and secure private keys offline. An offline software wallet could also be used to store private keys. This wallet has an offline partition for private keys and an online division which has the public keys stored. With an offline software wallet, a new transaction is moved offline to be signed digitally and then moved back online to be broadcasted to the cryptocurrency network.

The difference between private key and a public key

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