If you are an investor in cryptocurrency, it might be helpful if you know the history behind its technology. Crypto itself also comes from the underlying technology, namely cryptography.
As a crypto investor, it’s a good idea to understand cryptography, even at a primary stage, so that investors know more about the assets purchased in their investment portfolio.
Understanding Cryptography
Cryptography is a method used to protect information and communications through codes so that only the parties involved in the touch know the information.
Computer science refers to information and communication security techniques derived from mathematical concepts and some calculations called algorithms to maintain the confidentiality of information. It is difficult to change from programming language or code to ordinary language. T
he algorithm generates private keys for wallets, digital signing, data verification, internet opening, and confidential personal data communication.
The purpose of Cryptography
In addition to maintaining the confidentiality of communications, this technology is used to protect communications in networks that are not secure or can be attacked.
There are two types of attacks against communication networks, passive and active.
A passive attack is when the attacker only hears or sees passively information moving across the network.
An active attack is when the attacker resembles a vital person or party to take the circulating information and change it before the data can reach its intended destination.
The security and confidentiality of cryptographic-based protocols or applications can protect against these two attacks.
Through cryptography, authentication or authenticity checks must be carried out so that the entire communication process is carried out only between the parties that are supposed to be involved. Cryptography can also be used to protect data that is not being used, such as on a USB. The goal is that when the USB is stolen, the data remains inaccessible to the person who stole it.
History of Cryptography
One of the earliest histories of cryptography is the use by Julius Caesar in the 40th century BC under the name Caesar’s Cipher.
A cipher is a way to reveal, keep a secret, scramble, and restore secret information.
Caesar uses a substitution cipher where each letter is replaced with another note in a higher order than the original. For example, the letter A is replaced with a letter five times higher in mentioning the alphabet, namely F.
The goal is to make the message more secret and only understood by the user. Next is Giovan Battista Bellaso, a cryptologist around the 16th century who created the Vigener cipher.
Cryptology is used by creating a table like a picture above by writing messages like playing bingo where one line occurs.
Later the two communicating parties will have the same line, and in that line, there is a message that can only be opened by the parties involved.
After these two innovations, cryptography improved, and more advanced cryptographic systems emerged, such as cryptocurrencies. Despite innovations, the purpose of cryptography is still the same, namely, to maintain the confidentiality of a message.
Types of Cryptography
Cryptography has three types that most computer science developers and activists best understand.
Symmetric Cryptographic
Encryption Symmetric encryption or encryption with a secret key is the secrecy of information data that relies on only one key.
This means that the sender and receiver of data share the same secret key to send and unlock confidential information.
To do this, the recipient and sender of information must agree on a secret key before any data transfer occurs.
This type is riskier because it only relies on one key. If this key is attacked, then the secret in the information that will move can be opened.
Asymmetric Cryptographic
Encryption Asymmetric encryption or encryption with a public key differs from symmetric encryption because it uses more than one secret key.
Previously, information transfer would only use one key held by the sender and receiver. In this type, the sender and receiver share a public key but also have their private key.
These two keys are needed to unlock and read the bound information. With the private key and the public key, security is further enhanced.
This is because the attacker must have both keys, and the private key will be more challenging to obtain because it is always only held by their respective owners.
Cryptographic Hash Function
Hash functions are another way to secure information through cryptography. The difference from before, the hash function does not use a key but uses an algorithm to create a random password.
The password is a fixed-length string in computer science, where the number of characters or letters in the password will always be the same. But each owner has a different password from the other.
Unlike the previous type, the hash function can only move in one direction where data that has been stored encrypted cannot be held back in its original data format or form.
This technology is a type of cryptography used in blockchain because this type can maintain encryption in more extensive data.
Cryptographic Techniques and Algorithms Cryptography
uses techniques that can be studied in the computer science category to perform encryption.
The process used is the scrambling method, namely the procedure of changing letters or sentences of ordinary information into passwords.
The scrambling method is the basis of cryptographic technology, where scrambling itself is the beginning of the encryption process. Scrambling itself is different from encryption technically.
The most straightforward example is opening a door where this door is a door which must be opened to find out information that has been encrypted or changed the type of data to be secret.
The door will be locked through scrambling with a puzzle or riddles that all can solve.
So everyone can open it as long as they can solve it, but generally, those who have the answer are only those involved in transferring information. Unfortunately, it also means that other people can guess to complete the puzzle or riddles so that they can unlock the data.
The door cannot open only with a puzzle but must also be with a key.
This key is formed through an algorithm from mathematics.
Both of these technologies are used in cryptography to create security.
Modern Cryptography
Because cryptography and encryption technology have been around for a long time, innovation has not been spared, and currently, there are many modern or latest versions of cryptography.
There are four main features of the current cryptographic technology development: authentication, confidentiality, integrity, and Non-Repudiation.
Authentication
Cryptographic technology can be used for authentication. Authentication is a process where the sender and recipient can confirm the identity and the data or information used.
Confidentiality
Confidentiality is a feature of modern cryptographic technology to maintain confidentiality and security. Because with the latest technology, data can only be accessed by the party conducting the transaction.
Integrity
With modern cryptographic technology, currently, there is an Integrity feature where data that moves from the sender and receiver cannot be changed without the knowledge of both parties.
Non-Repudiation
Modern cryptographic technology also has a non-repudiation feature where; this feature is a condition where the sender and recipient cannot change or prevent the transfer or creation of information.
Cryptography in Crypto
Cryptography in cryptocurrency is an integral part because cryptography is one of the foundations of blockchain technology.
This technology is the main ingredient of why blockchain is considered safe and transparent but keeps the data private to the owner.
Cryptography will not escape the crypto world because even though blockchain and ledger technology continue to develop, everything will continue to use cryptographic technology.
The most common example of cryptography is using private keys and wallet addresses, both created through cryptography. Users will be given a seed phrase and a private key when they want to store funds in a decentralized wallet or blockchain wallet such as metamask.
Both things are published automatically, and the process is through a cryptographic function.
When having a wallet, investors will also have a wallet address or wallet address; the purpose is to receive funds. This wallet address is also issued with cryptographic technology.
Apart from these two uses, cryptography is also used in several other things, such as for transaction verification and ensuring that there are no duplicate records.
If you look at the picture above, the image is information about Ethereum transactions. All information is closed except nominal and wallet address.
The wallet address and transaction hash are the primary data of the transaction and are both enclosed by cryptography. So the actual application of cryptography is like the picture above. Please note that cryptography is at the core of blockchain and crypto, so understanding it is mandatory, even if it is only essential.
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