Keys and addresses are used in Ethereum blockchain mainly to represent ownership and transfer of Ether.
The private key is generated randomly and is kept secret whereas a public key is derived from the private key.
How Public Keys Become Wallet Addresses (Part 2)
Addresses are derived from the public keys which are a 20-bytes code used to identify accounts.
The process of key generation and address derivation is described here: 1.
First, a private key is randomly chosen (256 bits positive integer) under the rules defined by elliptic curve secp256k1 specification (in the range [1, secp256k1n − 1]).
The public key is then derived from this private key using ECDSA recovery function.
An address is derived from the public key which is the right most 160 bits of the Keccak hash of the public key.
An example of how keys and addresses look like in Ethereum is shown here: 1.
Why This Matters for Blockchain Technology
Private key: b51928c22782e97cca95c490eb958b06fab7a70b9512c38c36974f47b954ffc4 2.
Public key: 3aa5b8eefd12bdc2d26f1ae348e5f383480877bda6f9e1a47f6a4afb35cf998ab847f1e3948b1173622dafc6b4ac198c97b18fe1d79f90c9093ab2ff9ad99260 3.
Key Points to Remember
- Keys and addresses Keys and addresses are used in Ethereum blockchain mainly to represent ownership and transfer of Ether.
- The private key is generated randomly and is kept secret whereas a public key is derived from the private key.
- Addresses are derived from the public keys which are a 20-bytes code used to identify accounts.
- The process of key generation and address derivation is described here: 1.
Conclusion
Keys and addresses represents one of the many innovative layers that make blockchain technology so powerful and transformative. As distributed systems continue to evolve, a solid understanding of these core concepts becomes increasingly valuable — not just for developers, but for anyone building, investing in, or working alongside blockchain-powered systems.
Whether you are just starting your blockchain journey or deepening existing expertise, mastering these fundamentals gives you the tools to think clearly about decentralized systems and make smarter decisions in this rapidly evolving space.