How do public keys and private keys work in cryptocurrency transactions?

3 answers

• Dec 27, 2021 · 3 years ago
  Public keys and private keys are essential components in cryptocurrency transactions. Public keys are used to receive funds, while private keys are used to sign transactions and access the funds. When someone wants to send you cryptocurrency, they use your public key to create a transaction. This transaction is then signed with their private key to verify its authenticity. When the transaction is broadcasted to the network, miners validate the signature using the sender's public key. If the signature is valid, the transaction is added to the blockchain. Private keys must be kept secure and should never be shared with anyone to prevent unauthorized access to your funds. Public keys, on the other hand, can be freely shared with others to receive funds. Overall, public keys and private keys play a crucial role in ensuring the security and integrity of cryptocurrency transactions.
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• Dec 27, 2021 · 3 years ago
  Alright, let's break it down. Public keys are like your bank account number, while private keys are like your PIN code. When someone wants to send you cryptocurrency, they need your public key, which is a long string of characters. Think of it as your account number that you give to others. With this public key, they create a transaction and sign it with their private key, which is like their secret PIN code. This signature ensures that the transaction is authentic and can be verified by anyone using the sender's public key. Once the transaction is verified, it is added to the blockchain, and the funds are transferred. So, public keys are used to receive funds, and private keys are used to authorize and sign transactions. Remember, never share your private key with anyone, just like you wouldn't share your PIN code with strangers.
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• Dec 27, 2021 · 3 years ago
  At BYDFi, we understand the importance of public keys and private keys in cryptocurrency transactions. Public keys are used to generate addresses, which are like your virtual wallets. When someone wants to send you cryptocurrency, they need your address, which is derived from your public key. The address is a shorter and more user-friendly version of the public key. On the other hand, private keys are used to access and control the funds associated with your address. They are like the keys to your virtual wallet. When you want to send cryptocurrency, you sign the transaction with your private key to prove that you are the rightful owner of the funds. This signature is then verified by the network using your public key. If the signature is valid, the transaction is added to the blockchain. It's important to keep your private key secure and never share it with anyone. Losing your private key means losing access to your funds forever. So, always store it in a safe place and consider using hardware wallets for added security.
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