What is Bitcoin Identity? Is it an account? #5


hello everyone welcome to prime number
today I like to talk about the Bitcoin identity so what is Bitcoin identity
consider it like a bank account so in order to deposit or transfer money from
the bank you have to create a bank account through a banker the banker may
accept your bank account creation application or he will deny it
but Bitcoin since it’s decentralized there’s no central authority to do that
there’s nobody who permits you from creating an identity anybody can do that
so how the Bitcoin managed identity well there’s a trick in Bitcoin identity so in theory there is no actual identity in Bitcoin it’s just all the
public keys so any public key can be used to receive Bitcoin and whoever hold
the secret key paired to the public key can withdraw it so remember in one of our previous
episode we talked about the digital signature the digital signature works as
if you’re holding a secret key and you can use it to sign a message and whoever
get the signature the message and your public key can verify that it is signed
by you which means only you can present the signature and only you can present
the ownership of this public key so it looks like the public key is the actor
and you are the owner who can speak for the actor that is the Bitcoin identity
it doesn’t go through any authority or any creation process it’s just a number
identity is just a number you don’t have to create in any of the Bitcoin network
you don’t have to delete it you can just send Bitcoin to it and whoever hold
the private key can redeem it or it could be nobody
which means you send Bitcoin to an address which nobody holds the secret
key so we call it you can burn a Bitcoin so since identity is just a key pair
just a public key so you may think that the Bitcoin identity is anonymous well
it’s true and false so you can generate as much identity as you want if you want
ten identity you can manage ten of them and you are the owner for ten you can do
whatever you want but if you’re using one identity or one public key multiple
times which if we connect the dots of the behavior even though we don’t know
who is the owner of that identity but we may know from your statement from your
history it may looks like someone it’s like a alias or pseudonym that we can
link the name to you so don’t consider Bitcoin identity is private or it’s
anonymous all the transaction in Bitcoin network is public so if you use your
public key to receive and send transaction multiple times there could
be someone doing data analysis and keep tracking where you get money from where
you are sending to and link all the transaction together to draw a big graph
so that he may profiling you so again don’t think Bitcoin identity is
anonymous take it as a public if you really want privacy you can just
generate a key pair in Bitcoin and just use it one or two times and throw it
away it doesn’t hurt how many key pairs you generated there’s no limit on how
many identity you want to create it and nobody can control except you can do
that or there’s some wallets right now on the market that it can help you to
derive several different public keys from the key chain so that you can use a
different public key to receive a Bitcoin even though I keep saying sending
Bitcoin to a public key but actually it is the Bitcoin address that is not
exactly the public key it’s a public key with several hash function and some
encoding functions to make it short and representable so we can take a look at
how to convert a Bitcoin public key to a Bitcoin address here thanks for watching
comments below what you think and subscribe if you like this channel see
you next time

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