Does cryptocurrency use asymmetric encryption?

Asymmetric cryptography or public cryptography is an essential component of cryptocurrencies such as Bitcoin and Ethereum. These advanced cryptographic techniques ensure that the source of transactions is legitimate and that hackers cannot steal a user's funds. Asymmetric encryption is also known as public key cryptography (PKC). It uses two different keys for encryption and decryption.

The key that should be kept secret is called a private key, while the key that should not be kept secret is called a public key. For example, if A wants to send a message to B and make sure that B is the only person capable of understanding the message, A can encrypt the message with the public key so that only B can decrypt the message with the private key. First publicly described by Stanford University professor Martin Hellman and graduate student Whitfield Diffie in 1976, asymmetric encryption is described as a two-key cryptosystem in which two parties can engage in secure communication over an unsecure communication channel without having to share a common secret key. However, unlike the symmetric key, the asymmetric key problem increases when the public key has to be authenticated.

The use of asymmetric cryptography is when the environment is continuously expanding and data is exchanged between different communication partners. The asymmetric encryption algorithm has the advantage of having separate public and private keys, which can be transferred through unsecure channels. It is very necessary to ensure the security of the asymmetric encryption algorithm during the transmission of data on the blockchain. We can almost say that if you don't understand cryptography, you don't understand cryptocurrencies.

Blockchain and cryptocurrencies use cryptography in multiple ways for wallets, transactions, security, and privacy-preserving protocols. Symmetric key systems are faster and simpler (compared to asymmetric key systems), but they don't solve the problem of exchanging keys between sender and receiver if the key is not known beforehand. In asymmetric key cryptography, the private key must generally be generated using a random number algorithm and the public key is calculated by running an irreversible algorithm. Cryptocurrencies are one of the main applications of blockchains and use public-private key pairs to maintain user addresses on the blockchain.

However, if your question is what the two main types of cryptography are, the answer will be symmetric key cryptography and asymmetric key cryptography. In that sense, the Rivest-Shamir-Adelman, also known as the RSA method, is a public key cryptosystem that is most used to implement asymmetric key authentication.

Gertrude Majera
Gertrude Majera

Freelance web aficionado. Subtly charming zombie junkie. Typical coffee maven. Wannabe travel aficionado. Hardcore music lover. Passionate pop culture aficionado.

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