In the 21st century, digital signatures saved us from a terrible routine of printing out the documents, signing, scanning, and then emailing them to companies and organizations. When you need to verify your compliance or agreement, you sign a piece of paper. Today, physical signing is slowly becoming obsolete. Thankfully, printing out, scanning, and mailing is being left in the past as well.
What Are Digital Signatures In Blockchain?
Digital signatures ensure the security of the data, which is saved in the blockchain. They have become an integral part of the majority of blockchain protocols. These signatures are used for transaction security, sensitive information safety, software distribution, contract management, and other situations where external access may be unfavorable.
Digital signatures use asymmetric cryptography, which means that you can share the information with anyone by creating a public key.
In most first world countries, including the USA, the digital signatures are as valid as a regular signature. The advantages of the digital signatures are obvious. They allow storing and transferring the data on a blockchain. Such signatures guarantee integrity and safety of the information. The digitally signed data doesn’t just stay safe from the hacker attacks, it shows the sender and receiver if the third parties have tried to tamper with its integrity.
How Do You Use A Digital Signature?
In order to use the digital signature, you have to take advantage of software, which offers signing capabilities and can generate a hash of data that needs a signature. Then the private key encrypts the hash and the hashing algorithm to create a signature. The public key is generated to send to the message recipient.
How Are Digital Signatures in Blockchain Kept Secure?
Once the sender signs the document and creates the key for the receiver, the signature is secure. It doesn’t just guarantee the integrity of the document, it allows identifying the sender. One signature is connected to a certain user, so the receiver always knows whom the communication came from.
Digital signatures can’t be faked. Tricension cloud experts note that today even the most experienced hackers can’t copy the sender’s signature since it’s just not physically possible.
When creating the document and signature using the blockchain technology, the sender generates a public and a private key, both of which look like a set of numbers and letters. The public key is similar to an email address while the private key is the password. Unless you share the private key with someone, your signature is secure. It’s worth mentioning that there is no private key recovery feature. If it’s lost, it’s gone forever.
Since the digital signatures are bound to one particular user, they can be considered legally binding. This stems from the fact that the data can’t be compromised in any way known today.
What Is A Multisignature?
Blockchain allows the creation of a multisignature. This signature lets two or more people approve a certain document or transaction. Using a multisignature is easier and less problematic than collecting several individual signatures.
The multisignature concept has been around way before blockchain appeared. Today Bitcoin and other cryptocurrencies use these signatures to improve the security and allow several parties to show their agreement with one decision.