A bitcoin wallet contains a collection of key pairs, each consisting of a
private key and a public key. The private key (k) is a number, usually picked
at random. From the private key, we use elliptic curve multiplication, a one-
way cryptographic function, to generate a public key (K). From the public
key (K), we use a one-way cryptographic hash function to generate a bitcoin
address (A). In this section, we will start with generating the private key, look
at the elliptic curve math that is used to turn that into a public key, and
finally, generate a bitcoin address from the public key. The relationship
between private key, public key, and bitcoin address
A private key is simply a number, picked at random. Ownership and control over the private key is the root of user control over all funds associated with the corresponding bitcoin address. The private key is used to create signatures that are required to spend bitcoin by proving ownership of funds used in a transaction. The private key must remain secret at all times, because revealing it to third parties is equivalent to giving them control over the bitcoin secured by that key. The private key must also be backed up and protected from accidental loss, because if it’s lost it cannot be recovered and the funds secured by it are forever lost, too.
The first and most important step in generating keys is to find a secure source of entropy, or randomness. Creating a bitcoin key is essentially the same as “Pick a number between 1 and 2 256 .” The exact method you use to pick that number does not matter as long as it is not predictable or repeatable. Bitcoin software uses the underlying operating system’s random number generators to produce 256 bits of entropy (randomness). Usually, the OS random number generator is initialized by a human source of randomness, which is why you may be asked to wiggle your mouse around for a few seconds. More precisely, the private key can be any number between 1 and n - 1, where n is a constant (n = 1.158 * 10 77 , slightly less than 2 256 ) defined as the order of the elliptic curve used in bitcoin (see “Elliptic Curve Cryptography Explained”). To create such a key, we randomly pick a 256-bit number and check that it is less than n - 1. In programming terms, this is usually achieved by feeding a larger string of random bits, collected from a cryptographically secure source of randomness, into the SHA256 hash algorithm, which will conveniently produce a 256-bit number. If the result is less than n - 1, we have a suitable private key. Otherwise, we simply try again with another random number.
The following is a randomly generated private key (k) shown in hexadecimal format (256 bits shown as 64 hexadecimal digits, each 4 bits): 1E99423A4ED27608A15A2616A2B0E9E52CED330AC530EDCC32C8FFC6A526AEDD
To generate a new key with the Bitcoin Core client, use the getnewaddress command. For security reasons it displays the public key only, not the private key. To ask bitcoind to expose the private key, use the dumpprivkey command. The dumpprivkey command shows the private key in a Base58 checksum-encoded format called the Wallet Import Format (WIF), which we will examine in more detail in “Private key formats”. Here’s an example of generating and displaying a private key using these two commands:
$ bitcoin-cli getnewaddress 1J7mdg5rbQyUHENYdx39WVWK7fsLpEoXZy $ bitcoin-cli dumpprivkey 1J7mdg5rbQyUHENYdx39WVWK7fsLpEoXZy KxFC1jmwwCoACiCAWZ3eXa96mBM6tb3TYzGmf6YwgdGWZgawvrtJ
The dumpprivkey command opens the wallet and extracts the private key that was generated by the getnewaddress command. It is not possible for bitcoind to know the private key from the public key unless they are both stored in the wallet.You can also use the Bitcoin Explorer command-line tool (see Appendix G) to generate and display private keys with the commands seed, ec-new, and ec-to-wif: $ bx seed | bx ec-new | bx ec-to-wif 5J3mBbAH58CpQ3Y5RNJpUKPE62SQ5tfcvU2JpbnkeyhfsYB1JcnThe public key is calculated from the private key using elliptic curve multiplication, which is irreversible: K = k * G, where k is the private key, G is a constant point called the generator point, and K is the resulting public key. The reverse operation, known as “finding the discrete logarithm” — calculating k if you know K — is as difficult as trying all possible values of k, i.e., a brute-force search.
