Читать книгу Cryptocurrency All-in-One For Dummies - Peter Kent, Kiana Danial - Страница 26

Shhh. Don’t tell anyone. That’s the crypto in cryptography and cryptocurrency. It means “secret.” In the cryptocurrency world, it mainly refers to being “anonymous.”

Historically, cryptography was an ancient art for sending hidden messages. (The term comes from the Greek word krypto logos, which means secret writing.) The sender encrypted the message by using some sort of key. The receiver then had to decrypt it. For example, 19th-century scholars decrypted ancient Egyptian hieroglyphics when Napoleon’s soldiers found the Rosetta Stone in 1799 near Rosetta, Egypt. In the 21st-century era of information networks, the sender can digitally encrypt messages, and the receiver can use cryptographic services and algorithms to decrypt them.

What does Napoleon have to do with cryptocurrencies? Cryptocurrencies use cryptography to maintain security and anonymity. That’s how digital coins, even though they’re not monetized by any central authority or regulatory body, can help with security and protection from double-spending, which is the risk of your digital cash being used more than once.

Cryptography uses three main encryption methods.

 Hashing: Hashing is something like a fingerprint or signature. A hash function first takes your input data (which can be of any size). The function then performs an operation on the original data and returns an output that represents the original data but has a fixed (and generally smaller) size. In cryptocurrencies such as Bitcoin, it’s used to guess the combination of the lock of a block. Hashing maintains the structure of blockchain data, encodes people’s account addresses, and makes block mining possible. You can find more on mining later in this chapter, and in much more detail in Book 6.

 Symmetric encryption cryptography: Symmetric encryption is the simplest method used in cryptography. It involves only one secret key for both the sender and the receiver. The main disadvantage of symmetric encryption is that all parties involved have to exchange the key used to encrypt the data before they can decrypt it.

 Asymmetric encryption cryptography: Asymmetric encryption uses two keys — a public key and a private key. You can encrypt a message by using the receiver’s public key, but the receiver can decrypt it only with their private key.