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judymcconville@roadrunner.com 2017-04-28 10:16:44 -07:00
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@ -43,13 +43,13 @@ image::images/mbc2_0401.png["privk_to_pubK_to_addressA"]
.Why use asymmetric cryptography (public/private keys)?
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((("cryptography", "assymetric")))((("digital signatures")))Why is asymmetric cryptography used in bitcoin? It's not used to "encrypt" (make secret) the transactions. Rather, the useful property of asymmetric cryptography is the ability to generate _digital signatures_. A private key can be applied to the digital fingerprint of a transaction to produce a numerical signature. This signature can only be produced by someone with knowledge of the private key. However, anyone with access to the public key and the transaction fingerprint can use them to _verify_ the signature. This useful property of asymmetric cryptography makes it possible for anyone to verify every signature on every transaction, while ensuring that only the owners of private keys can produce valid signatures.
((("cryptography", "assymetric")))((("digital signatures")))((("asymmetric cryptography")))Why is asymmetric cryptography used in bitcoin? It's not used to "encrypt" (make secret) the transactions. Rather, the useful property of asymmetric cryptography is the ability to generate _digital signatures_. A private key can be applied to the digital fingerprint of a transaction to produce a numerical signature. This signature can only be produced by someone with knowledge of the private key. However, anyone with access to the public key and the transaction fingerprint can use them to _verify_ the signature. This useful property of asymmetric cryptography makes it possible for anyone to verify every signature on every transaction, while ensuring that only the owners of private keys can produce valid signatures.
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[[private_keys]]
==== Private Keys
A private key is simply a number, picked at random. Ownership and control over the private key is the root of user control over all funds associated with the corresponding bitcoin address. The private key is used to create signatures that are required to spend bitcoin by proving ownership of funds used in a transaction. The private key must remain secret at all times, because revealing it to third parties is equivalent to giving them control over the bitcoin secured by that key. The private key must also be backed up and protected from accidental loss, because if it's lost it cannot be recovered and the funds secured by it are forever lost, too.
((("keys and addresses", "overview of", "private key generation")))A private key is simply a number, picked at random. Ownership and control over the private key is the root of user control over all funds associated with the corresponding bitcoin address. The private key is used to create signatures that are required to spend bitcoin by proving ownership of funds used in a transaction. The private key must remain secret at all times, because revealing it to third parties is equivalent to giving them control over the bitcoin secured by that key. The private key must also be backed up and protected from accidental loss, because if it's lost it cannot be recovered and the funds secured by it are forever lost, too.
[TIP]
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