What are crypto wallet keys? (animated explainer video)

What are crypto wallet keys? (animated explainer video)

Cryptocurrencies need to have a substantial security system and crypto wallet keys play an effective role in this cause. Do you want to know what these crypto keys are and how do they work? You would not want to miss this video! I’m gonna share detailed information about this topic. Keep watching.

All cryptocurrencies such as Bitcoin, Ethereum, and others have robust security systems. They all are built on public-key cryptography. It’s a cryptographic system that uses pairs of keys. Public and private keys. Public keys are known to everyone on the network and help in identification while private keys are kept secret which helps in authentication and encryption.

Major cryptocurrencies like Bitcoin, Ethereum, and Bitcoin Cash function using three fundamental pieces of information: the address, associated with a balance and used for sending and receiving funds, and the address’ corresponding public and private keys.

Talking about Bitcoin, its address begins with a private key. The generation of a private key generates a public key using a known algorithm. The outcome is the address that can be used in transactions. It is short and we call it a public key.

The private key of the crypto wallet gives the user ownership of the funds at the given address. These private keys are automatically generated for you on the blockchain.

A private key is usually represented by a 256-bit number. This implies that it is embodied in binary in 256 numbers of 0 or 1. This number can also be addressed as 10^77 for clarity. If we round these numbers, these are almost the same.

Anyway, when you make your transaction from your crypto wallet, the software signs up the transaction from your private key without disclosing it. This indicates to the network that you own the transaction and you have the authority to transfer the funds to the address.

When it comes to the security of this system, it's a one-way street. We can service from the private key to the public address. We can't derive the private key from the public key. Moreover, in your blockchain wallet, you will have your 12-word Secret Private Key Recovery Phrase which is a seed of all the private keys of all the addresses generated within the wallet.

This seed key helps in restoring access to your funds even if you lose access to your original wallet. Using this seed key/recovery phrase, you can recover your crypto.

When Bitcoin was a bit new, the public keys used to work as receivers’ addresses. However, this could result in privacy leaks as blockchain forensics corporations could use an effective user’s agreement data to facilitate link wallets with users.

Видео What are crypto wallet keys? (animated explainer video) канала Crypto Decoded