What Is Public Key Cryptography?

PKC uses a pair of mathematically related keys:

Public Key: Shared openly; used to encrypt data or verify a digital signature.

Private Key: Kept secret; used to decrypt data or create a digital signature.

The key pair is generated using algorithms like Elliptic Curve Digital Signature Algorithm (ECDSA), ensuring that it's computationally infeasible to derive the private key from the public key.

How PKC Works in Blockchain

Key Generation: A user generates a private key, derives the corresponding public key, and then creates a public address (wallet address) via a hashing function.

Transaction Initiation: To send a message or cryptocurrency, the sender encrypts the data using the receiver's public key.

Digital Signing: The sender signs the encrypted message with their private key, creating a digital signature.

Verification: The receiver uses the sender's public key to verify the digital signature, ensuring authenticity.

Decryption: The receiver decrypts the message using their private key.

This process ensures that only the intended recipient can read the message and that the sender's identity is authenticated.

 Benefits of PKC in Blockchain

Confidentiality: Ensures that data is accessible only to the intended recipient.

Integrity: Protects data from unauthorized alterations during transmission.

Authenticity: Verifies the identity of participants, preventing impersonation.

Non-repudiation: Prevents the sender from denying the authenticity of their sent message.

Limitations of PKC

Performance: Encryption and decryption processes can be computationally intensive, especially with large datasets.

Key Management: Loss or exposure of private keys can compromise security, as there is no "forgot password" mechanism.

Scalability: As the number of users grows, managing and distributing keys securely becomes more challenging.

 Summary

Public Key Cryptography is integral to blockchain's security framework, providing a robust method for ensuring secure and verifiable transactions. By employing asymmetric encryption, blockchain networks can maintain confidentiality, integrity, and authenticity without relying on centralized authorities.