What is Cryptography?
Cryptography is the science of securing information by transforming it into an unreadable format, known as encryption, to prevent unauthorized access. In cryptocurrency, cryptography ensures the privacy, integrity, and authenticity of transactions on the blockchain.
By using cryptographic techniques such as hashing and public-private key encryption, cryptocurrencies like Bitcoin secure user identities and verify transactions without the need for a central authority. Hash functions, for example, generate a unique output for every input, providing a way to verify data integrity in the blockchain.
One of the core cryptographic methods used in Bitcoin is the Elliptic Curve Digital Signature Algorithm (ECDSA), which allows users to generate a public and private key pair. The public key can be shared openly, while the private key remains secret, enabling users to sign transactions securely.
Cryptography is critical to maintaining the security and decentralization of blockchain networks, making it a fundamental aspect of cryptocurrency technology.