Private keys that only cryptocurrency owners possess
Anyone who owns Bitcoin possesses a private key known only to them. This private key is used to create a digital signature that verifies the legitimacy of a transaction
. It is essential for sending Bitcoin
, and because anyone without the private key cannot use it without authorization, it also serves as a security measure.
Bitcoin is a cryptocurrency and, unlike Japanese yen or U.S. dollars, does not exist in a physical form such as coins or paper bills. Therefore, possessing a private key is the sole proof of Bitcoin ownership, and the system is designed so that only the person holding the private key can sign and send Bitcoin.
When Bitcoin is received, the party involved in the subsequent transaction can verify the signature to confirm that the funds were sent by the rightful owner, allowing them to proceed with the transaction with confidence.
Note that verifying the signature requires a public key; the system is designed so that when a signature is created using the private key, the public key is also included. In
Bitcoin transactions, a private key is always required; without it, payments cannot be made, and without a signature created using the private key and the corresponding public key, Bitcoin cannot be received.
