Foundations of Blockchain
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Digital signatures

So far, we have covered various different methods of encryption in the categories of symmetric and asymmetric cryptography. We also had a look at a few of the advantages of symmetric encryption techniques compared to asymmetric techniques. Thus, asymmetric cryptography is a rarely used encryption methodology. But the distinct design of asymmetrical keys makes it a suitable technique for applications other than encryption, and digital signature is one of them.

A digital signature is a method of providing proof of ownership of digital documents. Public-private key cryptography is widely used in the field of digital signatures due to their asymmetric key property. The owner can use the private key to sign a message or document, and the verifier can verify their ownership using the public key, which is distributed to everyone.

The process is similar to the handwritten signatures used in the real world, where an owner of an asset can use their signature to perform any action on that asset and anyone can verify the signature by comparing it with a signature that was used previously. The digital signature is more secure than the hand-written signature since it is infeasible to forge a signature without owning the private key:

Figure 2.11: Design diagram of a digital signature

Digital signatures could be used as a mechanism for ensuring the authenticity, non-repudiation, and integrity of an action. We can take an example of a software company distributing updates to its clients. How do these clients ensure that they can trust these software updates? This is where the digital signature helps to provide authenticity and integrity for those updates by allowing clients to verify them with the distributed public keys. Only the owners of the software can sign the software updates because they possess the private key.