What are public and private keys?
When creating a wallet based on implementations of Blockchain technology, i.e. cryptocurrencies, we generate a set of keys that serve as a digital signature. Understanding the principle of operation of keys is very important, because thanks to them we collect and control our funds, but without them we are exposed to the loss of our cryptocurrencies. Therefore, it is worth knowing why controlling them is so important.
When someone wants to send you any cryptocurrency, they need your public key, or more precisely a public address. You can share it freely, because the only function it fulfils is to be able to send money to it from another wallet. The public key itself is a very long string of characters, so when properly encrypted, it occurs in the form of an address, e.g. a public address:
* 1FwdPTJ7jU9j8j8ed4BqJJJ8VmhkigXGNHut – public address Bitcoin
* 0xC0f57c63488bb6309b596FcC635Ca0A3F4C67a27 – public address Ethereum
It is important to remember that you cannot send every cryptocurrency to all addresses, because your wallet, application or stock exchange must be able to read a token in a given standard in order to display it for us and give us the ability to manage it.
Specifically, if you send Ethereum to the address of BTC or Bitcoin to the address of ETH, you will lose your funds forever, because no wallet, for example bitcoin, will read a completely different standard in which the cryptocurrency was written.
However, if you send to the Ethereum address tokens built on the basis of this blockchain (ERC20 standard), you will be able to read them – you only need to use an application that gives such a possibility. Confidence that a given token has such a standard will give you access to the official website of the project and look at e.g. whitepaper.
A private key, apart from being our password, is also used to sign every transaction. Assuming that we should not share such a key with anyone (this would result in sharing the password to our wallet), the entire blockchain network is confident that the funds have been sent by the owner of the wallet.
Different wallet providers use different hashing functions, which results in the fact that our private key can be encrypted, e.g. as an encrypted key.
– a sequence of consecutive words, in the appropriate order (seed)
* cool pet hash motivate free gun pot stream doll great boring squeeze
– a character string of varying lengths
If we were to get our private key unencrypted when generating a new wallet, we would get a huge amount of characters that would be difficult to rewrite anywhere.
To make it easier to understand the pair of keys, the public key (address) is our bank account number, and the private key is our password, which we use to log in to our account and access our funds.
It should be added that not all wallets and applications give us the ability to generate private keys. In this case, it is the owner, the service provider of the wallet that controls them and only gives us the opportunity to use our funds through its application, which in fact controls it. You should not immediately assume that the service provider has bad intentions, although for your peace of mind you should choose wallets and applications that allow you to save and control your private key when creating an account.
Public and private keys can also be in the form of QR codes.
Thanks to this, when scanning the code, we can without transcribing or pasting the funds to this address, and the private key can thus import to any application or service that gives the possibility to import, in order to gain access to our funds.
This method is useful when we want to get to our wallet, which is saved in the form of a generated paper wallet, i.e. a paper wallet.
QR codes play a very useful role in the world of cryptocurrencies, because we can enter any amount that we want to receive on your wallet and the other side after scanning the code (which lasts a second) can immediately send us a fixed amount of money. Such a solution can work perfectly well in restaurants, for example, where the products have specific prices.