Proof of Keys- Steemit Crypto Academy- S4W7- Homework Post for @awesononso
Good day steemians,
It’s a pleasure being part of this season 4 episode of the steemit crypto academy community and I’m very grateful. Proceeding to present my homework post, I would like to acknowledge professor @awesononso and other professors for thier hard work and I sincerely appreciates the steemit crypto Academy community for the support.
Today’s topic is Proof of keys. Here is my homework presentation based on the questions given.
1.) Explain private and public Keys in relation to custodial and non-custodial wallets.
The private and public keys is a cryptography method that allows users to encrypt and decrypt token in a wallet. This method is as a result of Public Key cryptography.
The Private key is a peculiar key that is meant to be used for a single account and a user to approve commands. The private key enables the user to perform major account related activities such as withdrawals, transfers etc. This private key moreover shows authority and ownership of the tokens available since it serves as the command key to mobilize any tokens in the wallet. With the private key, the user manipulates all tokens in the wallet at will and anytime. When private key lost will cause user to loss all assets available as well.
The public key can be referred to as the address or name of the account. The public key is used to receive tokens into a wallet and not for any other purpose. After the public key has encrypted the received token, only the private key which is possessed by the owner of the wallet can mobilize the tokens. This however shows that the public key is not one that should be kept hidden to avoid being stolen of tokens.
The relation of private and public key with respect to custodial and non-custodial wallet.
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For custodial wallets, they are wallets type that involves the functions of third parties. Moreover the private key to the wallet are being possessed by the third party giving control of the wallet to the third party. With custodial wallet, the owners only possesses the public key to the wallet making him unavailable to perform vital account activities such as withdrawal, transfers etc at will. In this situation, the owners only issue commands and wait to be approved by the third party possessing the private key to the wallet. In this type of wallet the owners can only receive tokens when approved by the third party.
Considering non-custodial wallets, first of all no sort of barriers or intermediaries are involved.
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The owners possesses both keys; private key and the public key giving total authority and control over wallet. Hence the owner can issue command and approve as well at will. With non-custodial wallet, security depends on how the owner manages his private key. Well secured private key by the owner will cause difficulties to being hacked.
2.) What do you think about the Proof of Keys Day? What precautions would you take when participating?
Proof of keys day is a special day celebrated by crypto users to mark the beginning of the great crypto era thus the beginning of Bitcoin mining. This day at the long run has also mainly turned out to test our centralized exchanges if the balances encrypted in our wallets are really available and not just fake writings. I will say this is a very good idea brought up by Trace Mayer which was at first to celebrate the supremacy Bitcoin has cultivated. Proof of keys day is very important since it helps us to determine if our centralized exchanges are really holding our assets and available at all times. With this unworthy centralized exchanges are fished out and necessary measures are taken. During proof of keys day when crypto users clear their centralized exchanges balance depositing into a decentralized exchange accounts where authority over the assets is in full control. Proof of keys day is also to remind crypto user how best it is to possess and control your crypto asset and have authority over it at will.
precautions to take when participating in proof of keys.
- first of all,
securing the private keys to the decentralized exchange being used. I say this because you may loose asset when carelessly done. You may think you have your private key secured when it’s not. But for public key required to encrypt tokens will always be available. When one is to participate in proof of keys day, it best that you check to see whether the private key is secured before transfer.
- Secondly,
check whether the decentralized exchange is a genuine one. I will advise that whenever there is going to be a token transfer, simply confirm whether the exchange is genuine and free of Ponzi schemes.
- lastly
Wrong public key. This however is quite serious so consider when taking part in proof of keys day. This is because wrong public key would lead to loss of asset if it matches the address of another wallet. However we should take into consideration when taking part in the proof of keys day.
3.) Do you prefer Centralized exchanges or Decentralized wallets for storing your cryptocurrencies? Why?
First of all, I will like to spell out some differences base on that I will choose my stand.
| Centralized exchanges | Decentralized wallets |
|---|---|
| Involves third parties which could slows transaction time. | faster transaction time because no third parties are involved. |
| Users does not have complete authority over their assets. | user have full control and authority over the asset. |
| Access to the private key to the wallet is denied. | Allows and possesses the private keys and command at will. |
| Bears a higher risk of being hacked due to the huge assets in possession. | Bears a lesser risk of hack exposure. |
With the above differences, it’s quite clear and reliable to store your cryptocurrency in a decentralized wallet than to store in a centralized exchange. Centralized exchanges do offer unique features to help trader on crypto trades however, to store your cryptocurrency I will prefer decentralized wallet where I can boast ownership and authority over my assets as well as have complete control to asset mobilization.
4.) Let us assume it is Proof of Keys Day: a.)Transfer at least 20 Steem from your Binance wallet to your Steemit wallet. b.) Transfer at least 50 TRX from your Binance wallet to your TronLink wallet. (Provide Screenshots and make sure you have your Keys).
Withdrawing 21 Steem from my Binance wallet to my Steemit wallet.
Please follow the steps provided below.
- step 1
Visit your binance application and go to wallet, in your wallet then go to spot and tap on your available Steem tokens. Proceed by tapping withdraw.
- step 2
Fill in with your wallet address, amount to transfer and memo(optional). Steem amount to receive in my steemit wallet will be 20.99 due to the fee of 0.01STEEM charged.
Amount before transfer was 0.00 shown below.
Amount after transfer was 20.990 shown below.
Withdrawing 51TRX from my Binance wallet to my Steemit wallet.
Please follow the steps provided below.
- step 1
In your binance wallet, go to spot and tap on your available TRX tokens. Proceed by tapping withdraw.
- step 2
Go to your steemit wallet and copy address as illustrated.
- step 3
Fill in with your TRX wallet address and amount to transfer. Proceed to tap withdraw and then confirm
Amount before transfer was 12.421 TRX shown below.
Amount after transfer was 62.431 TRX shown below.
TRX amount to receive in my steemit wallet will be 62.431 due to the fee of 0.99STRX charged.
5.) In one statement, what is the major significance of the transfers in question 4.
The major importance is to show that each user can have complete authority and command over their assets or crypto to enable them mobilize them at will and at all time. This is as a result of user possessing the private keys to the wallet. It’s generally to show proof of keys.
Conclusion
I will to acknowledge professor @awesononso for this was a very good topic which was very well explained. Thanks for the humble service for I have understood the lecture very well.
Hello ryzsfa,
Thank you for taking interest in this class. Your grades are as follows:
Feedback and Suggestions
You should not have used the illustrations that were used in the lesson.
You did not properly follow the instruction in question 5.
Thanks again as we anticipate your participation in the next class.
Well noticed prof. thanks for the feedback.
Do not use the #club5050 tag unless you have made power-ups in the last 7 days that are equal or greater than any amount you have cashed out.
Okay thanks for the reminder.