What is Cryptography and What is its role in Blockchain?

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What is Cryptography and What is its role in Blockchain?

“I love this stuff – bitcoin, ethereum, blockchain technology – and what the future holds,” said Abigail Johnson, an American billionaire businesswoman and president and chief executive officer of American investment firm Fidelity Investments, and chair of its international sister company Fidelity International. Fidelity was founded by her grandfather Edward C. Johnson II. 

The creation of blockchain was made to remove the role of intermediate in any transaction and to offer peer-to-peer networks between two parties without leaking their confidential information.

The name blockchain is combined with two different words, in which “block” means the collection of data in a block and ” chain” means the connection between two blocks storing data as a list.

Blockchain technology is a well-written code with the help of Cryptography and lists are linked with it.

Understanding Blockchain Cryptography is not easy.

First, start with the understanding of Cryptography.

Cryptography is a hand-written code that is used to create techniques and protocols to remove the interference of any third party during the transition between two individual parties. This will create a barrier for any third party to get access to any confidential data or transaction details.

The cryptography work is created with two different words, “Krypto” which means hidden, and ” graphene” which means to write.

Cryptography is combined with different other terms:

Encryption:

The method of encryption is used to convert plaintext into ciphertext. This means the conversation of normal text forms into random bits.

Decryption:

From the name you can understand that it is completely the opposite of encryption. In this method, the ciphertext is converted into normal text or plaintext.

Cipher:

Cipher is a normal algorithm that is used to convert plaintext text into ciphertext.

Key:

Key carries a small amount of information that is used to induce the output of a cryptographic algorithm.

There are various cryptography types available in the blockchain but there are only three ways to create a cryptographic algorithm, that are symmetric-key cryptography, asymmetric key cryptography, and hash function.

Symmetric-key cryptography:

Symmetric cryptography uses a single key for both encryption and decryption of data. But using this method can cause you some issues, like as we told that it uses a single key method, which means that if you send the key from the sender side to the receiver, the information will not be secured.

It is also known as secret-key cryptography.

Asymmetric key cryptography:

In this method, there are two keys used to transfer information. One key is used for encryption and the other is used for decryption.

The key used in encryption is called the public key and the key used in decryption is called the private key.

Hash function:

In this method, there is no use of a key, neither in encryption nor in decryption. Instead of a key, the cipher is used to generate the hash value from a plaintext.

It is completely impossible for the components of plaintext to recover from the ciphertext. The Findora Founders system hosts transactions, assets, and programmable contracts that can be proven compliant, without compromising on privacy. Decentralized finance (DeFi) blockchain project Findora Founders has received an eight-figure funding round.