What are the Potential Security Methods used in Cryptocurrency?
Welcome to the 4th blog post in our series on Cryptocurrency. In this 4th and final post, David Orme, SVP Sales and Marketing at IDEX Biometrics explains some of the potential security methods used in Cryptocurrency. The previous post in our series on Cryptocurrency looked at the use of fingerprint biometric technology to fight Crypto Crime.
Cryptocurrency has been in the news a lot lately, and not for the best of reasons. Several cryptocurrencies have been hacked and attacked over the last few years, and these successful attacks diminish the feeling of confidence and reassurance in crypto currency’s staying power. This leads to the question: how can cryptocurrency be protected? Right now, there are several ways to bolster your crypto currency’s defenses, and we will go into them here.
Keep it to Yourself: Public and Private Key Cryptography
Sometimes, it is best to lock something with two keys. This is where asymmetric key cryptography comes into play, and it is just one way to protect cryptocurrency. Using this method, one key (typically, the public key) is used to encrypt the data associated with your cryptocurrency. The other key, then, (the private key) is used to decrypt that data and unlock your cryptocurrency wallet. The public key, as the name implies, is readable by and available to the public–this is why it is the half of the equation you don’t need to worry about. The private key, on the other hand, is your most treasured possession; keep it secret, keep it safe, and guard it well. If anyone figures out the private key, they can get into your cryptocurrency wallet and clean you out.
Make Things Hard to Hash Out
When a message is created on a computational database or a computer/machine/device, an associated hash is also created based on the contents of that message. The method used to determine a message’s hash is deterministic, so a message’s input will generate the same hash output every time. This is an easy way to generate a password strange enough to throw off hackers, as long as you don’t give the message away–it is easy to go from a message to a hash but difficult to work backward from a hash to a message. So, just like a private key, a message must be kept secret. The hash can be let out into the wild as long as you don’t provide clues to its corresponding message. An interlocking system that requires both a message and a hash is a relatively strong way to protect one’s cryptocurrency.
Put it All Together in a Digital Signature
Sometimes, a hash isn’t enough to protect your valuable cryptocurrency. It is possible to encrypt a hash with a private key so your layers of protection are stronger–in this case, hackers and thieves would need to know both your private key and the method to decipher your message from your hash, and this is an extremely unlikely combination to crack.
Biometric Locks May Be the Future
For all the fanciful methods used to safeguard cryptocurrency, there is one new method that may outdo them all. This is biometric identification technology, and it may be used to link all of your important information to your person: a lock and key that is impossible to open by anyone but yourself.
The previous post in our series on Cryptocurrency looked at the use of fingerprint biometric technology to fight Crypto Crime.