Crypto: The Importance of Private Keys

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Written by
4 years ago

Money is not a foreign concept to any of us, we all know how to use it, store it and how to attain money. We often refer to money as my money, our money and like to think we hold possession of money when in fact it couldn't be further from the actual reality of the situation.

Fiat money isn't an asset it has no value, we only use it because it is backed by our various governments and we've become so used to using it. It is only a promissory note of value but has no actual value itself.

CENTRALIZED MONEY ISNT YOUR MONEY

When most of us receive money for goods or services rendered we give it to a 3rd party (the banks) to store it in our name. We would then have some sort of security to access the funds if and when we need it.

You never really have ownership of those funds and if you perhaps did something these authorities did not like, such as speaking out against corruption or starting a competing business, you could be shut down in seconds and have your funds confiscated.

So now you'll say but I can protect against that by storing money under my mattress right? Well, that is only a half measure as all the money you own is tied to your government. They printed it and they own it, while you accepted this money as payment, governments can though poor economic decisions devalue money even faster than it already does each year through general inflation principles.

We've seen countries go through hyperinflation and they can attest to the fact that government sovereign currency isn't worth the paper it is printed on.

IMPORTANCE OF CRYPTO

Owning your own money

Since we've been raised in a system where we entrust control to third parties, the concept of owning your own money seems weird and foreign to most of us. Having to take complete responsibility for your own funds, how you manage it and transfer it is something we've been robbed of and a right we need to get used to having and fighting for against central financial control

This is why cryptocurrency is so important and why people need to start paying attention to the shit in mentality it brings.

A fundamental property of owning your own money is your private key.

What is the private key?

When creating a hot wallet or cold storage wallet for yourself you will receive a public address and a private key to start managing the funds in the wallet.

The first one — the public key — can be used anywhere to send and receive coins and tokens. Basically, it is the address of the wallet itself. It is quite simple and can often change with every transaction.

Your public keys are simply a way to receive funds and are attached to you private key which manages the actual wallet. The private key allows you to restore a wallet on any device and move funds to wallets should you require them.

Keeping your private key private

It is important to note that with a custody-free service you have the responsivity to store your private keys and passphrases in a safe place and in multiple locations both physical and digital as a security measure.

Do not share your private keys with anyone and if you're planning to store your crypto long term you may even want to add it in your WIll and testament.

I cannot express how important it is to guard your private keys. Having ownership of your own funds is a big responsibility and for many, I can understand why it would make them nervous.

Cheers.

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Thanks for this information.

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