What is Public Key

A public key is the publicly shareable component of an asymmetric cryptographic key pair derived mathematically from your private key through a one-way function that cannot be reversed. In cryptocurrency, public keys play a central role in verifying transaction authenticity and are the basis from which wallet addresses are derived.

THE ASYMMETRIC KEY PAIRA

symmetric cryptography (public-key cryptography) uses mathematically related key pairs where: the private key is secret, known only to you, and is used to sign (create) cryptographic proofs, and the public key is derived from the private key and can be shared freely it is used by others to verify that a signature was made by the holder of the corresponding private key. The critical mathematical property: it is computationally infeasible to derive the private key from the public key. This one-way relationship is the foundation of all blockchain security.

FROM PRIVATE KEY TO PUBLIC KEY: THE MATH

Bitcoin and Ethereum use elliptic curve cryptography (ECC) over the secp256k1 curve. A private key is a random 256-bit integer. The corresponding public key is produced by multiplying the private key by a fixed generator point G on the elliptic curve: Public Key = Private Key × G. Elliptic curve multiplication is a trapdoor function easy in one direction (computing public from private), computationally impossible in reverse (recovering private from public).

FROM PUBLIC KEY TO WALLET ADDRESS

For privacy and security, wallet addresses are not the raw public key but a hash of it:

Bitcoin: address = Base58Check(version + RIPEMD160(SHA256(public key))).
Ethereum: address = last 20 bytes of Keccak256(public key), prefixed with 0x.

This additional hashing layer provides an extra security buffer against potential future weaknesses in elliptic curve cryptography.

PUBLIC KEY IN TRANSACTION VERIFICATION

When verifying a Bitcoin or Ethereum transaction: the verifier has the transaction data, the digital signature, and the sender's public key. Using the ECDSA verification algorithm with the public key, they confirm mathematically that the signature was produced by the holder of the corresponding private key without ever seeing or needing the private key itself.

Terms in addition to the Public Key

Blockchain

A blockchain is a subset of a distributed database. The Bitcoin inventors originally prototyped the system in 2008. This modern database is made up of separate blocks that are connected together in a chronological chain. Blockchains may be used to store a wide range of data types. It has mostly been utilized as a public ledger for bitcoin transactions to date. A peer-to-peer network comprised of independent nodes uses a consensus process to ensure the blockchain's security and legitimacy. Each node in the network keeps a public and immutable copy of the data.

2 Factor Authentication (2FA)

2 Factor Authentication is a security measure with two layers. It is used by the majority of cryptocurrency exchanges. To log in, you must provide not only a password, but also a code obtained, for example, from the Google authenticator.

Airdrop

An airdrop is a method of distributing coins. End users can typically obtain coins for free or in exchange for doing a small task, such as subscribing to a newsletter, sending a tweet, or inviting others via a personal affiliate link. Cryptocurrency airdrops — the act of depositing cryptocurrency into public crypto wallets — are utilized as a marketing, liquidity creation, and network bootstrapping technique for many different types of blockchain initiatives.

Altcoin

Altcoin - "alternative coin" - is any kind of digital currency other than Bitcoin. Since the launch of Bitcoin, the world's first digital currency, many altcoins (as well as supporting blockchains) have been created. Altcoin digital currencies share many similarities to Bitcoin, but consistently and have significant differences. There are about 20,000 altcoins, and this number is expected to grow significantly in the coming years. Altcoins often develop Bitcoin features. Ethereum, currently the most widely used blockchain, supports digital contracts and separate applications where Bitcoin does not. Altcoins are also often created to cater to the needs of different users. The Litecoin blockchain, for example, can process payments quarterly for the duration of Bitcoin.

Cold Storage

Cold storage is the way to store cryptocurrency offline. The word refers to the use of offline wallets that are not connected to the internet. Cold storage is the most secure way to keep cryptocurrencies since an offline currency becomes less likely to be hacked and stolen. Paper wallets, printed renditions of private keys, and offline hardware and software wallets are all examples of cold storage.