Cryptography is the practice and study of techniques for secure communication from outside observers.
It’s taking information, concealing the real meaning of that information from everyone else, then sending that secret message to another party, and allowing that party to reveal the secret message using a special key.
In the Internet era, cryptography is used to protect computer information and “data”.
With cryptocurrencies, the “crypto” part of the name refers to how the transactions on a blockchain network are secured using encryption.
The communications between senders and receivers are kept safe, secure, accurate, verifiable, and in some part anonymous from each other and any other parties not involved in the specific transactions taking place.
Cryptography is a basic foundational element of all cryptocurrencies.
There are 3 main types of cryptography:
- Asymmetric-key cryptography
- Symmetric-key cryptography
- Hash Functions
Blockchains primarily use hash functions and asymmetric-key cryptography to securely link one block to another block within a blockchain, while also storing transaction data on a blockchain reliability and with immutability.
Immutability is a core feature of blockchain technology, which keeps blockchains permanent, unalterable, and tamper-proof.