Thanks guys for clearing that all up for me! Great answers. Seems like I've got some reading up to do but I'm really impressed by blockchain

I'm starting to get my head around Bitcoin, Blockchain etc. but I want to learn more about private keys, their generation, and use.

As I understand any 128-bit sequence can be a private key which can, in turn, be used to generate a 32-bit address using a one-way function.

1. Is there a set of rules that narrow down what is a good private key?
2. Is there anything in place to avoid collisions (multiple private keys to one address) other than statistics?

Also, roughly how many public addresses are currently storing bitcoin?

I see. Seems pretty secure. The last problem that I have then is how hard would it be to imitate the public key? a public key is derived from the private one but it is considerably shorter (64-bit?). Shouldn't multiple private keys match that public key? couldn't it be possible (and easier than a brute force on the private key) to simply find something that hashes out to the private key as it is the only part that is actually verified?



I'm just learning here and as I understand this forum's main goal is to educate/demystify/discuss bitcoin. It seems that you understand but I'm just starting to.
I appreciate everyone's help by the way. I know this must seem trivial.

Okay so I understand more now, a complete brute force would take multiple billion years because of the magnitude of possibilities (2²⁵⁶) Than you to https://bitcoin.stackexchange.com/questions/2847/how-long-would-it-take-a-large-computer-to-crack-a-private-key
But I'm still getting my head around the verification process for checking signatures. Even using the public key to cut down the possibilities there would still be billions of years of computing to crack the key. I was under the impression that you could get more info about the private key from every signature you see but that's incorrect, isn't it?
Also, what would happen if someone were to just send out random falsified transactions? Wouldn't that slow down the other nodes? couldn't you just write all the false transactions and have other nodes verify them?

This is where I get confused. I'm still reading into this. Private keys work on the basis of proving that you own the one and only privatekkey and the messages you write with it are indeed your own. But in blockchain, there is nothing hidden so the blockchain cannot verify using a private key. So how does it do that? How does it ensure the transaction uses the right key?

Even straight up brute forcing it, it's still possible right? Just not practical because it would take ages or tonnes of computer power.
Just out of curiosity though, if you poured the 1000s of THashes of computing involved in mining to crack a private key, how long do you reckon it would take?
Also, what would happen if you flooded the system (neighboring bitcoin nodes) with 1000s of random guesses?
Sorry for the tonnes of questions....

I'm relatively new so please be patient with me.
So I read a lot about people trying to crack private keys and passwords for wallets but why is there no talk of forging transactions?
No signature is perfectly safe and if you can see it used enough it should be possible to replicate it.
So why aren't people pushing around false transactions and brute forcing until they steal the BTC from someone else? 

Fair enough. But if I want to sift through the data using my own software, how would I go about that? Is it possible?

I downloaded the blockchain and have all the .dat files.
Now: how do I explore the inner workings of each block? Is there a way to parse them to text/XML?
I know this is probably ridiculous because of it's length and size but theoretically it should be possible to scrape the Blockchain right?

EDIT: I found a fraction of the answer in this thread: https://bitcointalk.org/index.php?topic=40822.0

Banks should be afraid of loosing business and their precious fees. (Unless they start somehow incorporating blockchain)
Governments should be afraid because they loose control over their own currency. (Unless they start "minting"/mining bitcoins)
People should be afraid because there is no customer service to call in crypto-currency. You get scammed or hacked and no one will save you.

Changes are coming...

The tricky part is that Bitcoin has no inherent value of its own other than the cost of the power to mine it. People are excited at Blockchain technology and it's potential so they are associating a lot of value to it. The truth is the cost of the power required to mine a single bitcoin (according to my very rough calculations) is 1000USD to 2000USD. As you can tell from current prices, it is FAR beyond that. So yeah, BTC should come down eventually either by a "pop" or by an increasing cost of mining/processing transactions.