Web3.0: Intro to Blockchain Cryptography

Web3.0: Intro To Blockchain Cryptography: Blockchain is currently one of the most innovative applications. Today, most Blockchain technology focuses on decentralization with capabilities for integrating consensus mechanisms, distributed data storage, digital encryption, and peer-to-peer transmission.

Digital encryption technologies are the core elements of blockchain technology. We’re going to focus on what cryptography methods are commonly used to build a blockchain network.

Cryptography:

Since blockchain operates on a peer-to-peer network model with multiple nodes servicing the transactions. Cryptography becomes an essential requirement for blockchain to safeguard user transaction information, privacy, and data consistency. But before we dive into how blockchain cryptography works, let’s try to understand what cryptography is all about.

Its main focus is to secure participants information and transactions. It serves as a method for transmitting information among two or more participants. The sender leverages a specific type of key and algorithm for encryption of a message before sending it to the receiver. Then the receiver employs decryption for obtaining the original message. The encryption keys ensure that unauthorized recipients or readers cannot read a message data value or transaction. Majority of blockchain applications don’t involve sending secret or encrypted messages.

Blockchain cryptography is mostly used to ensure security and complete anonymity of transaction details. The focus of applications of blockchain cryptography emphasizes encryption and decryption. Cipher and keys encryption is the process of converting information or data into a code. While decryption is the process of converting the encrypted code into its original form. A cipher is a algorithm for processes of encryption. As well as decryption and keys refer to the amount of information required to obtain the output from the cryptography algorithm

Digital Signature and Hashing:

Now let’s take a look at what digital signatures and hashing are. Both these components establish a significant role of cryptography in the blockchain. So what is a digital signature? A digital signature refers to a mathematical approach to creating digital codes. Digital codes can be used to verify whether digital messages or documents are decipherable.

The most most useful encryption method on a blockchain is asymmetric key encryption. The common name for Asymmetric key encryption is public key cryptography. It involves the use of different keys for encryption and decryption processes. Both the public key and private key use as the encryption key and decryption key respectively. Asymmetric key cryptography algorithms can generate the key pair. The public key can be shared openly while the private key is maintained in secret public keys.

Cryptography can help two completely unknown parties for exchanging information securely, so digital signatures can then leverage on public key cryptography and help individuals to prove ownership of their private keys while doing and users don’t have to reveal their private keys to other parties. And they can prove it by decrypting messages hence the applications of cryptography and blockchain with digital signatures make sure that the transactions between two different individuals are as intended.

SHA-256 Algorithm:

Next, we’re going to look at how cryptography hashing works in blockchain technology as a matter of fact. Cryptographic hashing is the basic component of blockchain technology. And the most common cryptographic hashing algorithm is SHA-256 hashing function.

It involves taking a string of any length as input and producing an output with a fixed length, so no matter how many times you enter a specific input, and the hash function delivers the output of the same length. This output is always unique, which is why you don’t have to worry about having the same output from two different inputs.

Another thing about cryptographic hash functions is that they’re a one-way function, which means it’s near impossible to derive the original input from the output. All these are the fundamental building blocks that blockchain.

How to find a Crypto to invest in 2022- Read Here

Find Best Cryptocurrency: How to Research About a Crypto, Bitcoin, Dogecoin, Shiba INU etc.

Stock vs Cryptocurrency, How to Research About a Cryptocurrency ?

Stock vs Cryptocurrency :

Whenever we pick a stock for investment So we check that it is the stock that is holding the value of the company and how is the performance of that company. We check the balance sheet of the company, such as how much profit is increasing, how much revenue is being generated, along with sales; we also check their intrinsic value. We do proper fundamental analysis before investing in any stock. What to check before investing in cryptocurrency? How to know which crypto is fundamentally strong or not. This is what I am going to tell you in this article. As there is underline business in stocks, it depends on its performance. In cryptocurrency, its price actually fluctuated because of hype, because of news and events, and because of demand and supply.

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How to Research About a Cryptocurrency:

To get to know crypto currencies you will first go to their

1) website and know who they are and what they are doing

2) Will find out his team,

3) who is the founder, how many well know, how much experience is in the crypto industry

4) The higher the market cap of that crypto, the more secure it is for us. Although the risk still remains, the more one is invested in that cryptocurrency, the higher the market cap, then the slightly less volatile that cryptocurrency will be.

After this,

5) we will check who has invested in that cryptocurrency. 6) who has partnered with that crypto project Like the Indian government has also worked with some cryptos. Along with that, 7) you will check which wallet has been held. It is not that only two to three wallets have been held, as with Dogecoin, which is somewhere under the control of those wallets. As soon as you sell or buy, the price of the cryptocurrency will fluctuate. Along with this, 8) You read the white paper. Everything will be written in a white paper on their website only about cryptocurrencies. Who are they, what you want to do, if you have a white paper then you will get more clarity.