What Is a Public Key in Crypto?

Introduction

In the world of blockchain and cryptocurrencies, public keys are crucial components of securing transactions and proving ownership. Although they are often confused with wallet addresses, public keys play a unique role in generating addresses and verifying digital signatures. Understanding how public keys work is essential for anyone using blockchain wallets or handling crypto transactions.

In this article, we’ll break down what a public key is, how it’s created, how it’s used in crypto systems like Bitcoin and Ethereum, and how it differs from a wallet address.

What Is a Public Key?

A public key is a cryptographic code derived from a private key. It is used to generate a wallet address and verify digital signatures in blockchain transactions. While the public key can be shared freely, its paired private key must be kept secret.

Public keys help ensure that funds are sent securely to the correct address and that the sender truly owns the assets they are transferring.

Key Takeaways

• A public key is generated from a private key using encryption algorithms.
• It is used to create a public address and verify digital signatures.
• Public keys help ensure trustless, secure crypto transactions without exposing sensitive information.
• Unlike private keys, public keys can be shared openly.

How Public Keys Are Created

When a user creates a cryptocurrency wallet, a pair of keys is generated:

• The private key is a randomly generated number.
• The public key is created by running the private key through an elliptic curve cryptography (ECC) function.

This process is one-way, meaning you can generate a public key from a private key—but it’s virtually impossible to reverse the process and get the private key from the public key.

How Public Keys Are Used in Blockchain Transactions

Public keys serve two primary purposes in crypto systems:

1. Verifying digital signatures

When a transaction is signed using a private key, the public key can be used by the network to verify that the signature is valid—without revealing the private key.

2. Creating public addresses

Public keys are converted into public addresses, which are what you share with others to receive funds.

Blockchain Example: Bitcoin vs. Ethereum

• Bitcoin: The public key is hashed and encoded using Base58Check to produce the wallet address.
• Ethereum: The last 20 bytes of the public key are taken and prefixed with 0x to generate the address.

Public Key vs. Public Address: What’s the Difference?

Although they are related, public keys and public addresses are not the same:

• A public key is used to generate a digital signature and a wallet address.
• A public address is the shorter, user-friendly version of the public key hash and is what’s shared for receiving funds.

Fast Fact: While it’s possible to generate a public key and address from a private key, it’s nearly impossible to reverse-engineer the private key from either of them.

Why Public Keys Are Important for Crypto Security

Public keys are a critical component of asymmetric cryptography, the system that underpins blockchain security. Their design ensures that:

• Private keys remain confidential.
• Public keys enable transparency without compromising safety.
• Only the owner of the corresponding private key can authorize transactions.

If someone loses their public key, it can be regenerated from the private key. However, if the private key is lost, the associated funds become inaccessible permanently.

Frequently Asked Questions

How Do You Generate a Public Key in Ethereum?

Ethereum wallets automatically generate the public key from the private key when the wallet is created. Users typically don’t need to manually handle public keys.

How Big Is the Ethereum Public Key?

An Ethereum public key is 64 bytes, or 128 hexadecimal characters.

How Do I Find My Crypto Public Key?

Most wallets do not display your full public key directly, as it’s not usually needed. You’ll typically see your wallet address, which is derived from the public key.

Conclusion

Public keys are foundational to blockchain technology. They allow users to send and receive cryptocurrencies securely, generate wallet addresses, and validate transaction signatures. While often overlooked, public keys are a vital component of the cryptographic systems that make decentralized finance possible.

At Cregis, we understand the importance of secure key management. Our Self-Custodial MPC Wallet, Wallet as a Service, and Crypto Payment Engine are built to ensure your keys—and your crypto—are protected at all times.