Blockchain Cryptography: Part 1

Abstract

Cryptology is the science of encrypting and decrypting information and the methods employed to those ends. Cryptography (from the Greek "kryptós" (secret, hidden) and "gráphein" (writing) is a subset of cryptology that describes the creation of methods for encrypting information so it cannot be understood by unauthorized parties. Steganography refers to methods for disguising the communication channel over which cryptographically encrypted messages are sent. Cryptanalysis, another important sub-discipline of cryptology, is concerned with methods for decrypting cryptographically encrypted information without the consent of the party that encrypted the original message. Therefore, while a cryptographer changes information so it appears incomprehensible, the cryptanalyst renders this information comprehensible again, usually without permission. Our desire to communicate secretively and the need to devise encryption methods to ensure sub rosa communication can be traced to ancient Egypt and Mesopotamia, with Hebrew scholars making the first serious attempts to use simple substitution ciphers around 600 BC (Sect. 6.2.1). Cryptographic methods play a crucial role in ensuring the proper operations of any blockchain system, but none of these early techniques, of course, provide enough security in today's computer age. This chapter provides a comprehensive overview of both the cryptographic building blocks (e.g., "hashing") and the underlying algorithmic processes, that is, the public-key cryptography and digital signatures that are used today to ensure the high level of security and control that blockchain-based systems offer.