Proof of Keys- Steemit Crypto Academy- S4W7- Homework Post for @awesononso

In the crypto world we must have been hearing the word keys and wonder what it really means, we often hear keep your private keys and we wonder what does it really means and how does it really work.

The aim of this lesson is to let us really know what these keys mean and what they do. Before we talk about the keys we need to first know the Genesis of the word keys in cryptocurrency by looking at the word cryptography.

Cryptography is a way of keeping informations and communications safe from third parties by coding the informations, this way only those who needs the information can actually read and process it.

The word cryptography in computer science simply means to secure information and communications which is derived from algorithm ( a set of rules based Calculations) and mathematical concepts to change the informations in a way that it's hard to read.

This technique and algorithm are used for the generating of keys, digital signing, verification of data protection, web browsing, confidential communications and so on.

Now that we know what cryptography really is we need to know that in cryptocurrency there are two major types of keys common which are the public keys and the private keys and we will be looking at them one after the other.

PUBLIC KEY.

cryptography, a public key also known as asymmetric cryptography is a combination of numerical value that is used to encrypt informations. This keys can be generated by software programs butvitvis also provided by some designated authority and made available to everyone through a directory.

A public key is also very useful in encrypting messages or verify digital signature to check if it is legit, it is usually accompanied by a private key which only the owner know what it is ( we will discuss more about private key). Public keys are designed using an asymmetric algorithm, which gives a particular public key to a specific private key.

A public key is always available to everyone who the individual wishes to give it to or to communicate with, it is usually stored on a public key server which is used to encrypt data safely before it is sent over the internet.

PRIVATE KEY

A private key is also known as a secret key is a term in cryptography that is used with algorith yo encrypt and decrypt information. It is a key that is known to just the owner and only he can know what it means. It is typically a long randomly generated sequence of bits that aren't easily guessed. It's security or how easy it can be back depends on the complexity and the length of the private key.

The private key is very unique to it's public key and it's needed to sign trànsactions and show the proof that one owns the particular information or asset. It is used to decrypt the coin in a wallet, which means anyone with the private key can access the wallet and this shows ownership, this is why it is very important to keep the private key safe so as not to misplace and shownl it to untrusted parties.

In cryptocurrency, crypto uses cryptographic algorithms to store, exchange and generate digital value. Cryptocurrency uses the asymmetric cryptography for creating digital signatures that validates value transfers. The private keys are used for symmetric encryption and there is usually a public-private key given to crypto users to protect their data.

Some valid ways to keep the private key so as not to loose access to ones crypto is to save them in an isolated computer that doesn't have internet connection or in hard copies or better still if it can be committed to memory.

DIFFERENCES BETWEEN PUBLIC KEY AND PRIVATE KEY

Public keys can be likened to a bank account number, they can be freely given to everyone and people can send trànsactions to them while the private key is a confidential key that needs to be kept secret, it is just like the pin to our ATM card.

Public key dies the work of encryption while the private key decrypts the information encrypted by a public key.

You might be wondering how to get both the public key and private key, this can be gotten from what we call a wallet in the crypto space. A wallet is the one that contains both the private and public key and an address for it user.

A wallet is an encrypted virtual key chain containing details required to access one fund and it is used to store and transact assets. There are two main tueoe of wallet in cryptocurrency which are the custodial wallet and the non custodial wallet.
The definition of both wallets will be based on the idea of the private key and the public key.

CUSTODIAL WALLET

This wallet works in a way that we are familiar with when we have money with us but give it to a thrift collector or a saving group, our money is kept by a third party who can do whatsoever he or she wishes with the money even though the money is yours, this is just the principle which the custodial wallet works with, it is a type of wallet that is owned by someone but the private key is kept and controlled by a third party.

This third party can choose to do whatever they wish with the asset in the wallet, this type of wallet is what is found in centralized exchanges wallet such as binance, okex, huobi and the likes.

NON CUSTODIAL WALLET

This type of wallet allows the user orbowner to have possession of both the public key and the private key. It is the opposite of the custodial wallet as there is no third part involved in how the wallet is been controlled or have any say over the wallet.

This type of wallet is the regular wallet where we store our assets like the trust wallet, token pocket and the likes where there are no rules guiding the wallet unless the fact that the user has to keep the private key very safe.

This wallet can be likened to a piggy bank where we keep our money ourselves and the lock remains with us and we do whatever we wish with it by our own decisions.

PROOF OF KEYS

To ensure an investor so financially independent it is essential to keep ones private key safe. Although alot of crypto traders and investors have more trust in centralized exchanges and leave their assets there and this is a costly thing to do because the exchange has full control.over your asset which we discussed above.

Billions have been lost due to hacks on exchanges and scam, this is what brought about what we know today as proof of keys day

Proof of keys is an idea that was created by Mayer Trace a crypto investor who created this idea as an annual celebration that is set to remind crypto investors to recalim their assets fully. Proof of keys day is set to prevent investors from depending solely on exchanges to sore their asset.

This is what brought about the word not your keys, not your Bitcoin.

The event takes place on January 3rd after the first event which took place in January 3rd 2019 which happens to be Genesis block mined on Bitcoin network 10th anniversary. The proof of keys day also celebrate financial freedom which goal is to encourage traders and investors to move their funds from exchanges to wallet so as to have full control.over their funds and private keys ensuring they are the only one that has control over the funds.

IMPORTANCE OF PROOF OF KEYS DAY

1. It is used to celebrate the Genesis block of Bitcoin which was the first trànsaction done on the network when Satoshi sent 50BTC to Hal Finney.

1. It is used to teach newbies in crypto how to move their assets from centralized exchanges to wallet

1. It exposes shady centralized exchanges

1. It is used to remind investors who really have control over their assets.

PRECAUTIONS TO TAKE WHEN JOINING YHE PROOF OF KEYS DAY

Investors should be sure of what wallet to move their funds to and ensure it is a secure wallet and not a scam wallet. It should also be noted that the private key of the wallet has to be kept very safe so as not to loose the assets in it.

Also new investors that haven't known how to move coin around should seek help from experienced people so as not to loose finds as well.

Centralised exchanges vs decentralized wallets

In my own opinion the use of centralized exchange should be for trading and not the storage of crypto as it is not secured as a Decentralized wallet.

The major function of decentralized wallet is to keep assets and this is why I prefer it to the centralized exchange. The decentralized wallet also gives confidence that I am in charge of my asset and not a their party.

So I head over to my Binance wallet. Since I have 65 steem in my Binance wallet, I will be clicking withdraw

Then I will input my steem username in that address option and then input the amount of steem I want to send. In this scenario I will be sending 21 steem

Then I click confirm

And then the withdrawal request will be processed

As you can see, it has already appeared in my steem account

Transfer at least 50 TRX from your Binance wallet to your TronLink wallet.

(Provide Screen

Now I will be transferring 50 trx from my Binance wallet to my tronlink wallet

Currently in my Binance wallet I have over 250 Trons

So I will go to my tronlink pro account and copy the receive address for my trx

Then I will head to my Binance wallet under the Trons

Then I click withdrawal

As you can see above, I will input the address I copied from my tronlink pro account earlier. So I will be sending 51 Trons as charging fee will be removed of 1 trx to make it 50 Trons

The withdrawal request will be processed.

I will head back to my tronlink pro wallet to confirm me receiving the 50 Trons

In one statement, what is the major significance of the transfers in question 4.

I believe the major significance of the transfers in question 4 is that I am in full ownership of my funds and I can decide to move it when I decided convenience

@awesononso