What are Bitcoin private keys, Luno

Moving around Bitcoin is very effortless, but ter the background an significant part of moving and storing Bitcoin involves something called a ‘private key’. The easiest way to understand private keys is to think about an old-fashioned mailbox system:

Let’s say Maria wants to send mail to Peter. Very first she needs to know what Peter’s mailbox address or number is. Let’s say Peter’s mailbox is number 2034. Similarly, if she wants to send Bitcoin to Peter, she needs to know his Bitcoin address, which is a number that uniquely identifies him. This is also sometimes called his wallet address, or public key, which functions similar to your handelsbank account number. It’s a long and complicated number because there are so many Bitcoin postbode boxes te the world, but gratefully you don’t have to recall it, you can find it on the internet.

So now Maria deposits the Bitcoin ter Peter’s mailbox. She can have a peek inwards and see the Bitcoin there, ter fact anyone who walks by can see that mailbox 2034 is packed with one Bitcoin. This is part of the arousing part of Bitcoin – that everyone can see all the transactions but without anyone having to share their identity. People can see there is one Bitcoin te 2034, but no-one, except for Maria and Peter, will know it belongs to Peter.

Now let’s see how Peter gets his Bitcoin – well he can see it’s there, so he doesn’t have to do anything. But if he wants to stir it, he needs to open the opbergruimte to send it to someone else. To open this he needs a key – and this is his own unique key, also called a private key, that him, and only him can use to open the mailbox. When he opens it he can eliminate the Bitcoin and deposit into someone else’s opbergruimte, let’s maybe say he is buying an online spel from Microsoft, now he can deposit it into Microsoft’s opbergruimte and once they can see the Bitcoin received, they will ship the fresh spel to him.

If Maria deposits into the wrong mailbox, she cannot budge it back. This is similar to specie – once you paid it to someone you can’t lightly get it back. Also note that no-one can budge the Bitcoin, except for Peter, who has the key to the mailbox. And if he loses his key? Well then no-one can access that postbode opbergruimte, forever! It’s also significant for Peter to make sure no-one steals his key, because if they do they can unlock his opbergruimte and steal his Bitcoin. So it’s significant he keeps the key safe, or entrust it with someone that can do so.

Bitcoin private keys give you access to the Bitcoin system.

Related movie: How to install vertcoin miner (scrypt-n) ter ubuntu linux


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