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Author Topic: Help me to understand private key of crypto currency  (Read 349 times)
laraveldeveloper
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April 05, 2018, 04:47:51 AM
Merited by suchmoon (1)
 #1

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
2) How it is validated while sending payment to any other key.

guys please help me to under the concept of private key. 
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April 05, 2018, 04:52:39 AM
Merited by achow101 (2), DarkStar_ (2), suchmoon (1)
 #2

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
2) How it is validated while sending payment to any other key.
Private keys aren't stored on the blockchain, just in the individual wallet of their owner. This is important because anyone with access to the private key can spend that user's bitcoins.

Transactions are validated by checking that their cryptographic signature corresponds to the public key of the sender. This is proof that the transaction was signed using the user's private key.

Have you read the Bitcoin whitepaper already?

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April 05, 2018, 05:14:38 AM
Merited by suchmoon (1)
 #3

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
Private keys are not (and should not be) stored in a decentralised ledger. The Blockchain (aka "The decentralised ledger" as you've called it) is public and simply records reassignment of "ownership" of bitcoins from one public key to another.

Private keys are exactly that... PRIVATE... they are not meant to be shared and should be kept safe, secure and guarded appropriately.


Quote
2) How it is validated while sending payment to any other key.
When attempting to transfer coins from a public key to another public key, you prove "ownership" by cryptographically signing the transaction using the appropriate private key that matches the public key you are transferring FROM. The various nodes will then check that the signature provided matches the public key. If it does not (ie. the transaction is not signed, or signed with the incorrect private key) then the transaction will be rejected by the network as invalid.

Note... you CANNOT derive a private key from a signature that has been put on a transaction.

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April 05, 2018, 06:04:15 AM
 #4



Can you guys tell me some good explanation about signature in above image so i can under stand the private key concept.
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April 05, 2018, 08:33:38 AM
 #5

Can you guys tell me some good explanation about signature in above image so i can under stand the private key concept.

I think HCP already explained it pretty well.

For another small explanation visit this site: https://bitcoin.org/en/how-it-works.
A slightly more detailed conclusion: https://coinsutra.com/bitcoin-private-key/.

Or, probably one of the best sources (if not the best), the original Whitepaper by Satoshi.

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April 05, 2018, 04:24:00 PM
 #6

I suggest you learn the basic of Digital Signature and Cryptography, i'd recommend you this book Mastering Bitcoin, 2nd Edition since you're a developer.



Can you guys tell me some good explanation about signature in above image so i can under stand the private key concept.

TLDR version :
1. You need private key to make a transaction. The transaction contains receiver sender/receiver public key so others can verify your transaction.
2. You only need public key to verify the transaction, but you won't able to get the private key from public key/transaction easily.

Use SegWit and enjoy lower fees
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April 07, 2018, 06:42:19 AM
 #7

Basically private key is use to store public key data into the wallet Right .There is no other existence of private key while transaction. Miners validate the public key and then they will add new block to the ledger.
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April 07, 2018, 06:53:13 AM
Merited by AdolfinWolf (1)
 #8

Basically private key is use to store public key data into the wallet Right .
Private keys can be used to derive the public key and its hash which can in turn allow the wallet to identify all the relevant transactions related to the wallet. The main function of the private key is to sign the transaction.
There is no other existence of private key while transaction. Miners validate the public key and then they will add new block to the ledger.
Incorrect. Private keys are the main thing when making a transaction. Without a private key, the transaction wouldn't have a signature and it would be invalid. Private keys are used to generate a signature to validate that the inputs can be spent.

Everyone that runs a node will validate the signature, not only the miners. The miners have to check the validity of the transaction first before generating the merkle root and try to mine a block.

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April 07, 2018, 01:41:17 PM
 #9

Basically private key is use to store public key data into the wallet Right .

The private key is used to derive the public key, to sign transactions/messages and prove the ownership of the corresponding public key.



There is no other existence of private key while transaction. Miners validate the public key and then they will add new block to the ledger.

The private key itself is not 'stored inside' the transaction. But it is used to create a valid signature which basically says: 'I want to spend the UTXO from this public key'.
A valid signature can only be created with the private key corresponding to this public key. This signature can then be verified with the public key.
Miners do validate the transaction before including it into a block. After a block containing this transaction has been added to the blockchain,
every full node does validate the whole block for itself. This prevents miner from adding transactions with an invalid signature into a block.

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April 09, 2018, 01:28:19 AM
 #10

The private and public key are part of a system called asymmetrical cryptography.

Fisrt you have the private keys, it will control all of your money and the other keys (so you dont want to announce it.
With your private key you can generate the public key, if you have only the public key you cannot recover the secret key, so its safe to announce it (but there is no reason for).
And with your public key you can generate the address, which is only a few of hash functions applied at the public key, is with this hash which you will want to announce and receive money.

Why we cant announce our private keys ? only the private key can sign a transaction with the coins which you posses, nobody can guess your private key using only the signature too.

About the descentralized part of the bitcoin, is that the whole ecosystem of the bitcoin do not depends only of a group person/server/node, and nobody can make a chose in the blockchain alone without any consensus of the other nodes.

If you want to learn more, visit the wiki of the bitcoin or explore the links of the posts above.

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April 10, 2018, 06:52:17 AM
 #11

First thing you need to know about cryptos, be weary of advice online and in group. Not everyone is a scammer and you can get good advice from the public; however, some scammers may also attempt to mislead you. So any information you get online, double check with multiple sources...

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April 11, 2018, 09:26:47 AM
 #12

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
2) How it is validated while sending payment to any other key.

guys please help me to under the concept of private key. 

If easy to say: Private key is individual password for access your bitcoin.
Private key not stored.. generated only one time for one public wallet (address wallet).
All details you can read on https://en.bitcoin.it/

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April 12, 2018, 05:41:19 AM
 #13

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
2) How it is validated while sending payment to any other key.

guys please help me to under the concept of private key.  

If easy to say: Private key is individual password for access your bitcoin.
Private key not stored.. generated only one time for one public wallet (address wallet).
All details you can read on https://en.bitcoin.it/

You mean private key is not part of block chain blocks. Private key is a part of wallet which are using to store bitcoin by us. Then how we can validate particular transaction comes form which wallet.Is it possible to transfer one wallet btc to different wallet btc like we can say coinbase to blockchain wallet?
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April 12, 2018, 07:32:21 AM
 #14

Then how we can validate particular transaction comes form which wallet.
Public key helps with it.
Is it possible to transfer one wallet btc to different wallet btc like we can say coinbase to blockchain wallet?
Yes, of course. The same thing if you transfer your money between different accounts in different banks
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April 13, 2018, 08:44:09 AM
 #15

You mean private key is not part of block chain blocks. Private key is a part of wallet which are using to store bitcoin by us. Then how we can validate particular transaction comes form which wallet.

Anything signed with a private key can be verified with the corresponding public key.
I suggest you read this article about asymmetric cryptography.
This should let you understand the whole private-/public key infrastructure.


Is it possible to transfer one wallet btc to different wallet btc like we can say coinbase to blockchain wallet?

You can transfer BTC's from any address to any other address. This does require an on-chain transaction, of course.
Either between online wallets (what your question is) or to any other wallet (e.g. desktop-, mobile-, hardware- or paper wallet).

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April 16, 2018, 01:44:21 PM
 #16

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
2) How it is validated while sending payment to any other key.

guys please help me to under the concept of private key. 

Above mostly presented very descriptive of private key concept technically, I just want to simplify the concept to you of this private key in common or daily activities used. Let's assume this to bank account, with this approach you can consider public address as bank account and private key to be considered as PIN (Personal Identification Number). You can share your bank account (Public Address) to everyone while your fund inside the wallet is still safe, but you DO NOT share your PIN to everyone as someone can access your bank account easily.

Hope you can more understand the concept.

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April 16, 2018, 02:01:57 PM
 #17

Private keys are not stored in the blockchain, they are only used to *validate* your transaction. Think like you are storing MD5 or SHA1 encrypted passwords for login system of a website. Do you "know" what the password is? You only validate if the user's password is equal of the stored one with encrypted input. But on blockchain there are no passwords stored, only they are being validated according to the algorithm.

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April 17, 2018, 08:55:18 AM
 #18

Private keys are not stored in the blockchain, they are only used to *validate* your transaction.

Private keys are used to sign transactions.
Public keys are used to verify the signature.



Think like you are storing MD5 or SHA1 encrypted passwords for login system of a website.

MD5 and SHA are hash functions.
Hash functions are 'one-way functions'. This means it is relatively easy to calculate a hash, but *impossible* to calculate the input out from the hash.

Encryption on the other hand has to work in both directions (encrypting and decrypting).

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April 17, 2018, 01:24:05 PM
 #19

When someone sends you cryptocoins through block chain they are sending them to a hashed version called public key ,the another hidden key is called the private key  it's used to drive the public key
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April 24, 2018, 02:39:26 PM
 #20

I am a developer. these days we are going to jump into Crypto well. So i have read lots of blog online how Crypto currencies works. But i am little confused for the private key.

1) Where it is stored in decentralised ledger.
2) How it is validated while sending payment to any other key.

guys please help me to under the concept of private key.  

I can assume you are coming from JavaScript background, according to text in profile. In this case you probably find helpful the "crypto" library from NodeJS https://nodejs.org/api/crypto.html , especially the ECDH part https://nodejs.org/api/crypto.html#crypto_class_ecdh

It also has some examples and explanations.

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