Most Bitcoin addresses are derived utilizing public key cryptography, so in the identical manner that our pockets can use a non-public key to signal a transaction that spends some BTC, it might probably additionally use a non-public key to signal an arbitrary message (on this case, a message that claims “I personal this tackle!”).
As instance: By utilizing the personal key that controls a funded bitcoin tackle, you’ll be able to show that you just personal the cash saved at that tackle (or no less than, you’ll be able to show that you’ve got information of the personal key that may spend them). Let’s imagine Tackle X has 1 BTC, and so that you create a message that reads ‘Tackle X is managed by Takwon’, after which signal that message utilizing the personal key for Tackle X. Now you can move this signed message to somebody, they usually can confirm that you just do certainly have information of that personal key.
This publish has data about the way to create a signed message utilizing bitcoin-cli:
Learn how to signal a message utilizing Bitcoin personal key?
This publish has data about the way to confirm a signed message utilizing bitcoin-cli:
How can I confirm a signed message?
This publish has data in regards to the nature of the signed message – to be completely positive that somebody owns the tackle in query, you ought to present a message that they are going to signal.
If somebody needed to fake to be Satoshi by posting a faux signature to defraud folks how might they?
And is/might this be executed with out really revealing which cash/components of cash you management? Solely that you’ve got X quantity of BTC in your pockets.dat?
The tactic above reveals which tackle(es) you management to anybody that’s verifying the signed message(s). I’m unaware of any technique that will let you show possession of some quantity of coin, with out revealing which particular UTXOs represent these funds. Maybe there’s some fancy ZKP math which might be executed on a UTXO set dedication to perform this, however so far as I do know no such factor has been developed for Bitcoin right now (and, maybe it’s not attainable, I will depart that to the cryptographic specialists to elucidate in additional element).
