Private Key - what is it, what is its feature?

A Private Key is a unique cryptographic code used to protect security and ensure unhindered access to the owner of cryptocurrencies to his assets.

The cryptocurrency system operates on unique digital algorithms. All digital coins have only one expression format - electronic. Accordingly, transactions with different types of such money and tokens are carried out exclusively electronically. For the stable operation of any cryptocurrency system, it must support the basic principles of anonymity of each participant, decentralized regulation, transparency, reliability and security. In addition, it is important to ensure that transactions are technically conducted so that users do not doubt the transparency and integrity of all transactions. It is all these tasks that Private Key solves.

Private Key - features and specifics

Any transaction that is carried out with cryptocurrency is carried out according to the generally accepted algorithm:

  • a system participant creates a payment;
  • it must be confirmed - this is what the Private Key is used for (there are also public keys that are used simultaneously by several users);
  • after that, miners check the transaction (as well as the amount of money in the owner’s account, the availability of the payment amount), and then confirm it (the transaction becomes valid);
  • the transaction is added to the source code in the current block on the blockchain.

Considering this specificity, we can define Private Key as a unique digital signature of the owner of digital coins when confirming payments. However, in addition to this, the private key also provides access to the crypto-wallet where such coins are stored and provides the possibility of using them. Depending on the need, one or more public keys are associated with each private key. The public access code can be restored using the private key if it is lost. If you lose your private key, then access to all cryptocurrency assets will also be lost.