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Figure 1.3: Verified transactions If this seems hard to grasp at this point, think of it this way: it is all derived from this simple expression: data signed with the private-key can be verified using the public-key. There is nothing more to it. The spender simply signs data that says “I am the owner of transaction ID XXX, I hereby send every coin in it to B”. B, and anybody else, can check that it was A, and only A, who wrote that. To do so, they need only access to A’s public-key, which is available in the transaction itself. It is mathematically guaranteed that no key other than A’s private-key can be used in tandem with A’s public-key. So by simply having access to A’s public-key anyone can see it was A who sent money to B. This makes B the rightful owner of that money. Of course, this is a simplification. There are two things we have not considered: who said those 50 coins where of A’s property (or, in other words, did A just take ownership of some random transaction, is he or she the rightful 10PDF Image | Intro to Ethereum and Smart Contracts
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