The Two Keys That Control Everything
When you own Bitcoin, you really only own one thing: a private key. This key proves the coins are yours and allows you to send them. Everything else — your public key, your Bitcoin address, your wallet — derives from it.
That sounds abstract, but it's the foundation of all Bitcoin security. And it's worth understanding properly.
Private Key — Your Secret Password
Think of your private key like the key to a bank safe deposit box. Whoever has it gets access to the contents — whether they're the owner or a thief. There's no customer service to change the lock.
What it is: An extremely large random number. Technically, a Bitcoin private key is a 256-bit number — that's 2²⁵⁶ possible combinations. For comparison: the number of atoms in the visible universe is estimated at about 2²⁶⁶. The probability of randomly generating the same key as someone else is practically zero.
What it looks like: Depends on the format. As a hex string, for example:
E9873D79C6D87DC0FB6A5778633389F4453213303DA61F20BD67FC233AA33262
In practice, you never work directly with the raw key. Instead, you use the seed phrase — 12 or 24 words that serve as a human-readable representation of your key.
What it does: It signs transactions. When you send Bitcoin, your wallet creates a digital signature using the private key. This signature proves to the network: "Yes, the owner of these coins authorized this transaction." And the clever part: the signature proves ownership without revealing the key itself.
→ More about backups: Seed Phrase Backup — 5 Methods
Public Key — Your Public Counterpart
From the private key, the public key is mathematically calculated. This works in one direction only: from private key to public key — yes. From public key back to private key — practically impossible.
The analogy: Imagine you have a special padlock. Anyone can put something in the box and push the lock closed (= send you Bitcoin, using your public key). But only you have the key to open it again (= your private key).
What it does: Two things. First: your Bitcoin address is derived from it (the address is a hashed, shortened public key). Second: it verifies your signatures. The network uses the public key to check whether a signature really came from the corresponding private key.
The Chain: Seed → Private Key → Public Key → Address
Here's how everything connects:
Seed Phrase (12/24 words)
↓ is converted into
Private Key (secret number)
↓ One-way calculation (elliptic curve multiplication)
Public Key (public key)
↓ Hashing (SHA-256 + RIPEMD-160) + encoding
Bitcoin Address (what you share)
Each step is a one-way street. You cannot reverse-engineer the input from the output. That's the mathematical foundation that makes Bitcoin secure.
→ All about addresses: Bitcoin Address — The Complete Guide
What Happens During a Transaction?
A concrete example: you want to send 0.01 BTC to a friend.
- You enter their address and the amount in your wallet
- Your wallet creates a transaction and signs it with your private key
- The signed transaction is broadcast to the Bitcoin network
- Miners check: does the signature match the public key of this address?
- If yes: transaction is confirmed and written to the blockchain
- Your friend sees the coins on their address
At no point is your private key disclosed. The network only sees the signature and the public key — and can verify that the transaction is legitimate.
Common Misconceptions
"My Bitcoin are stored in my wallet."
No. Your Bitcoin exist only as entries on the blockchain. Your wallet stores only your private key — the access key. That's why you can restore your wallet on a new device as long as you have your seed phrase.
"If someone knows my address, they can steal my coins."
No. Your address is like an IBAN — anyone can send you money, but nobody can withdraw. For that, they'd need your private key.
"I can change my private key."
No. The private key is mathematically fixed. What you can do: create a new wallet with a new key and transfer your coins there.
"My seed phrase is something different from my private key."
Not quite. The seed phrase is a human-readable representation from which your private key (and all subsequent keys) are deterministically derived. Whoever has your seed phrase has all your keys.
The Golden Rule
Private key / seed phrase = keep secret. Always. Without exception.
No support agent, no website, no app, no person may ever ask you for your private key or seed phrase. Anyone who does wants to steal from you. That's not an exaggeration — it's the reality of crypto.
→ Secure your key: Seed Phrase Backup — 5 Methods
→ Recognize scams: Bitcoin Scam Protection
→ Back to overview: Bitcoin Address — The Complete Guide
Last updated: February 2026