What is a Private Key and How to Store it?
Entrusting your data to a third-party service to protect it from cyberattacks might be convenient, but ultimately, there’s no guarantee that they will protect it.
With decentralization, you can take ownership over your data, but this comes with its own responsibilities, namely to safely store your private key.
In this article, therefore, we’ll explain what a private key is in the first place and how you can store it safely.
#What is a Private Key and Why is it Important?
As we exchange more and more data over the Internet, the risk of that data getting into the wrong hands drastically increases.
That is why you need a way to securely communicate online and that is **public key encryption.
This is a method of encrypting sensitive data with a pair of keys - public and private.
The public key is available for anyone to use and is used to encrypt the data, for instance, an email message you don’t want anyone but the recipient to read.
However, once the encrypted data reaches the recipient, they need a way to decrypt it, that is to revert it back into its original, non-encrypted state. Otherwise, they won’t be able to read it and it will look like random garbage.
This is where the private key comes in.
This key decrypts the data back from ciphertext into plaintext and unlike the public key, which anyone can access and have, only the intended recipient can own a private, or secret key.
Here’s an example of how this works:
- Let’s say you want to send a “hello” message to someone. This would be a plaintext.
- To make it secure, you need to turn it into a ciphertext by using a public key, let’s call it 2x0t0q85
- Now, in order to read the message in plaintext, the recipient will need a private key to add to the ciphertext. Let’s say that the key is 4Vcs84q5.
#How to Store Private Keys?
As the private key needs to be something that only you can access this immediately eliminates using a third-party provider like the cloud for example.
The reason being is that a malicious actor can gain access to it and the service itself might go out of business, taking your data with it.
This leaves a few other options, namely: 1) ### Decentralized Cloud Storage
We know we just said that you shouldn’t store your private keys on the cloud, but that goes for centralized clouds like AWS, Google Drive, Microsoft Azure and the like.
Things are different when it comes to decentralized cloud storage.
For instance, Telios uses the Sia cloud to store your private keys. Sia uses unallocated hard drive space from computers or peers in its decentralized network. What this means is that there is no single point of failure to worry about. 1) ### Hardware Wallets
Another option you have, if you don’t want to keep your private keys online at all, is to use a hardware wallet.
This is a device similar to a flash drive that, in addition to storing your private key, also lets you set a seed word or a mnemonic phrase. That way, even if you lose your wallet or someone steals it, they’ll need to know your seed word to access the private key.
Here are 10 best practices to keep your passwords safe.
You can check out Trezor Model One or the D’Cent Biometric Crypto Wallet on Amazon, for instance, if you’re looking for one. 1) ### Flash Drives
One issue with hardware wallets is that they can be expensive. Most of them cost $100 and above.
If you’re looking to save money you can use a flash drive. The benefit of this approach is that it is cheap. You can buy a flash drive for $5.
However, unlike a hardware wallet, which will have a seed word and encryption itself, flash drives have no such protection so if you lose it, or it gets stolen, the other person can access what’s inside without much trouble. 1) ### On Your Computer or Smartphone
You can also opt to store a private key on your computer or smartphone.
This saves you the hassle of having to use another device to store the key and then having to plug that into your computer to access the key.
Of course, the problem arises when your device is online, which is today most of the day. This ultimately leaves your private key vulnerable if someone hacks your device and there’s also a danger of getting it stolen so you’ll need to protect the device itself with a password, PIN, or some sort of biometrics.
Of course, there are a lot more ways to store your private keys Than these four. Let us know in the comments which ones we missed!