Cryptography: Securing Blockchain Transactions
Cryptography is a branch of research and practice for protecting information that prevents third parties from reading information to which they are not authorized.
What is cryptography?
For a long period of history, cryptography was exclusively concerned with the technique of ciphers, algorithms that were used to turn ordinary messages (called “plaintext” in cryptography) into imaginary nonsense (called “ciphertext”). These messages could then be sent using letters, with the recipient using auxiliary information (called a “key”) to decrypt the ciphertext back into readable plaintext. The information transmitted in this way was useless to outside adversaries without knowledge of the key, even if the letter was physically intercepted – that is, before the development of cryptanalysis, the discipline that deals with cracking encryption algorithms.
The earliest types of ciphers, called substitution and transposition ciphers and collectively called classical ciphers, could be both encrypted and decrypted by hand. This means that they did not scramble information enough to counteract the methods of cryptanalysis available at the time.
With the advent of radio and, later, Internet communications, the need for strong encryption became more acute than ever, as messages were now indiscriminately transmitted and could be intercepted at will.
Today, cryptography is used by default in many computer communications. Among its many uses are hash functions such as SHA-256, which is used to secure the Bitcoin (BTC) network and other cryptocurrencies.