There are several definitions for cryptography. Its usage cuts across different fields and the concept behind cryptography has various use cases. Generally, cryptography is a method of using codes to protect information and communication between two or more parties. Cryptography shields the data from those who have no authorized access. The use of cryptography dates back to World War 2 and the era of Julius Caesar, when he used ciphers to send encrypted messages to his generals in the ancient period.

Cryptography has evolved over the years. It is the technique derived from mathematical concepts and the combination of rule-based calculations called algorithms. These combinations will transform messages into encrypted forms that are hard to decode or decipher unless you have the authorized key. Cryptography contains algorithms that are used for cryptographic key generation, data privacy, digital signing, verification, confidential communications, etc.

Cryptography and Bitcoin

Although cryptography has been used in various forms for centuries, its use in the context of cryptocurrency can be traced back to the invention of Bitcoin in 2008. Bitcoin’s creator, Satoshi Nakamoto, used cryptography to secure the transactions and set up the creation of new coins. Transactions are secured by creating a digital signature for each of them using a private key, which increases the reliability of the entire network and the privacy of its users.

Since the creation of Bitcoin, the use of cryptography has been applied in many other cryptocurrencies, and it has become a fundamental part of the digital currency ecosystem.

What Is Cryptography?

Cryptography is the technique deployed in encrypting data or information to keep it hidden from third parties. Technically, cryptography uses complex computer codes and mathematical technology to encrypt data and convert the data to complicated forms. The reason for changing the data to a problematic form is to hide the true meaning of the information so that only those with permission can decipher it.

Cryptography is central to cryptocurrency. Cryptography enables digital transactions to be pseudonymous and free from third-party compromise.
Cryptography is deployed in cryptocurrency for securing transactions, controlling the creation of additional blocks, and verifying the validity or transfer of assets. Cryptocurrency uses public-key cryptography, and Cryptography gives crypto transactions anonymous, secure and trustless features.

Cryptography transforms information and encrypts it into an “ambiguous” form that unintended recipients can not understand or decode. In cryptography, readable texts in the simple form are changed utilizing the algorithm into “gibberish” called ciphertext. Until such plain text reaches its right destination or the intended recipient inputs the correct key, such information will not revert to its original form.

The term “crypt” is a Greek word that means “hidden,” “secret,” while “graphy” means “writing” or “knowledge.” So literally, the definition of Cryptography is “secret writing” or the “knowledge of secrecy.”Central to the cryptography technique is encryption and decryption. Encryption is the process of converting plaintext into ciphertext, while decryption is reverting the message from ciphertext to plaintext.

How Does Cryptography Work?

Cryptography deploys encryption and decryption techniques. Cryptography works with algorithms and keys, and it could be a public key or a private key. The key in cryptography is a piece of information or numbers specifying how the algorithm is applied to encrypt the plaintext. Cryptography makes it difficult to decrypt the ciphertext back to plaintext even if you know the encryption method.

Cryptography in cryptocurrency, computer networks, and cyber security are similar. How cryptography works in these fields is based on the cryptography techniques you deploy, and it could be symmetric or asymmetric cryptography.

In symmetric cryptography, the same key is used for encryption and decryption. As a sender of the information, you must also have the shared key that is available to the recipient. This technique uses key distribution to convert plain text to ciphertext by the sender and revert from ciphertext to plaintext by the receiver. Symmetric cryptography is used mainly in keeping confidential data between two parties. In symmetric cryptography, the secret key is essential; it should be between the authorized party.

In asymmetric cryptography, separate keys are needed for encryption and decryption. Every user in the asymmetric technique will require public and private keys to encrypt and decrypt information. The private key is kept secret, while the public key is distributed to all parties. In asymmetric cryptography, the key a sender uses to encrypt a piece of information or file differs from the key used to decrypt such a file. However, the keys come in pairs; a public key can only be paired with its exact private key.

The symmetric type of cryptography is speedy and used in encrypting large volumes of data, while asymmetric cryptography techniques are much slower and can encrypt smaller volumes. So what cryptography does is combine the two methods. Asymmetric cryptography encrypts symmetric encryption keys, which can contain large volumes of data.

Pros of Cryptography

Some of the notable advantages of cryptography include:

Confidentiality and integrity: Cryptography ensures that the data in transit and the stored data are kept confidential. It keeps the integrity of the messages, the sender, and the receiver. The level of trust in a piece of information increases when you realize it has been encrypted and you need keys to decrypt it.

Protection and security: Cryptography serves as a protection and security measure. In cryptocurrency, token developers and digital wallets use cryptography to secure transactions from attackers. The combination of private and public keys helps keep your wallet safe and protects it during transactions or while idle.

Authentication of sender/receiver: In most instances, knowing the identity and ensuring that the right sender sends the message or the suitable receiver receives the message is essential. Cryptography helps authenticate the sender’s identity and establishes the receiver’s identity. Both sender and receiver use cryptography to confirm each other’s identity.

Cons of Cryptography

The shortcomings of cryptography include:

Loss of keys: One of the problems that people face in cryptography is accidentally misplacing their public or private keys. It could be that you forgot the keys or do not have access to where you stored them. When you lose your public keys, you can generate new ones after a rigorous process. Albeit, when you lose a private key, you may never be able to access such information encrypted or lose access to your digital wallet.

Hacking: Hackers still find ways to bypass cryptography and gain unauthorized access to information. In cryptocurrency, hackers steal all funds and divert transactions to their wallets when they find ways to decrypt your encrypted data or generate the keys to your wallet.

Conclusion

Cryptography is a robust technique that protects data and ensures the correct information is restricted from the wrong parties. Cryptography uses algorithms and keys to keep data safe, and it uses mathematical computations and codes depending on how sophisticated you want the encryption to be.