What is Private Key?

What is Private Key?

Private Key Summary

A private key is like a password, a string of letters and numbers, that allows you to access and manage your cash funds.

when you buy moeda virtual for the first time, you receive two keys: a public key, which acts like an email address (meaning you can share it with others, allowing you to send or receive funds), and a private key, which it is usually a string of letters and numbers (and should not be shared with anyone).

You can compare the private key with a password that opens the virtual vault that holds your money. As long as only you, exclusively, have access to your private key, your funds are safe and can be managed from anywhere in the world with an Internet connection.

Why are Private Keys Important?

Public and private keys are one of the cryptographic innovations that make digital money possible and secure. Find out how they work.

Virtual currencies such as Bitcoin and Ethereum, are decentralized, meaning there are no banks or other intermediary institutions holding your digital money. Instead, your Cryptocurrencies are distributed over a computer network through a technology called a blockchain.

What is Private Key?

One of the characteristics of block chains (blockchain) of crypto coins is that they are open: all public keys and transaction information are available for everyone to see.

Through some complex mathematical operations, your public key is generated by your private key, matching the two. When you make a transaction using your public key, you confirm your identity using your private key.

While everything is available, it's also anonymous, and you don't need to provide a name or address, or any other information to use crypto currency.

Take Bitcoin, for example. While any curious observer can see when Bitcoin is bought, sold or used, only the holder of a private key can carry out these transactions.

Where Should You Keep Your Private Keys?

Similar to any password, it's crucial to keep your keys private. safe. The two main ways to keep them under control are:

Store them online in a digital currency wallet: the best and simplest option for most people is to use a virtual wallet to manage their private keys. These are known as “hot wallets” because your private keys are stored on the Internet.

This makes buying, selling, or using your digital money as convenient and affordable as using a credit card online. Choose a wallet provided by a company with a long security record and features like two-factor authentication.

Store them offline in a safe place: some investors they choose to keep their private keys on a computer that is not connected to the Internet, written down on paper, or even memorized. This is called “cold storage”, and while protecting the private key from digital theft, it makes using your crypto coins much less convenient, leading to other risks.

5 / 5 - (7 votes)

Related Posts

error: