How does Cryptocurrency Technology Secure Transactions?
Cryptocurrency technology was introduced in 2009 post which it became a sought-after mode of transaction. Thus, business owners had to find service providers that enabled them to accept payments via cryptocurrencies. But as is the case with any form of transactions, owners were sceptical about the security of cryptocurrency transactions as well. However, this form of payment proved to be more secure than several other online payment methods. Depending on the technology, it is segregated into public and private. Public network technology allows several individuals to join in while keeping them anonymous. Private network technology on the other hand, uses identity confirmation for membership and privileges. Read on to know how crypto payment gateways provide secure transactions.
Through Blockchain Technology
Blockchain technology has been the backbone of cryptocurrency payment gateways ever since its introduction. The technology produces a structure of data along with inherent security qualities. This technology is also known as DLT which translates to Distributed Ledger Technologies. The process involves data being structured into blocks where each blocks contains one or a bundle of transactions. Every fresh block is connected to the other blocks before it in a cryptographic chain, making it tough to tamper with. The transactions within each block are agreed upon by a consensus mechanism and validate to confirm its authenticity.
Through Cryptography Technology
Another mode of security used by crypto payment gateways is cryptography. This technology enables two or more individuals to send and receive secure messages. These messages are encrypted in a key and algorithm that can be decrypted only by the receiver. Encryption keys play an essential role in securing the messages, valued data and transactions between two individuals that cannot be read or enable access to an unauthorized entity. It therefore secures your transactions from fraudulent attacks.
Through Asymmetric Technology
Asymmetric cryptography technology is amongst the most recent introductions for cryptocurrency payment gatewaysecurity systems. This technology uses two keys namely the public and the private keys for data encryption and decryption. While the public key allows easy dissemination of information like the address of the fund receiver, private key remains known to the owner exclusively. Thus, in this method the customer can encrypt a transaction using your public key, however, only you will be able to decrypt it via your private key. It, therefore, helps with authentication with the public key that verifies how genuine the sender is. The private key on the other hand, decrypts the encryption by the paired key.
Through Symmetric Technology
This is a single key technology used by cryptocurrencies payment gateways to secure transactions. It uses a single key to encrypt source messages, transmit it to the recipient and decrypt it at the destination. The transactions can be decrypted only by the technology that receives the transactions. Therefore, any malicious third party would be unable to decrypt and have access to the transaction without knowing the method of decryption. It is an enhanced security technology which includes several complex variations to provide optimum security to your business. It requires minimal operational overhead with a simple implementation process.
Through Smart Contract Technology
Smart Contract Technology is an innovative technology used by crypto payment gateways for securing transactions on a global level. It requires two parties agreeing to form a computer code. This code is then run on a blockchain and stored in the public database. This code cannot be changed or tampered with thereafter. The transactions then take place between these two parties without allowing access to any third party. As there is no inclusion of a third party, you get to save a significant brokerage amount as well!< Next post - Beginners Guide to Cryptocurrency Payment Gateways Prev post - Does Your Business Really Need a Crypto Gateway? >