Hello and welcome to all! I am writing this homework regarding Proof of Keys Day to share my knowledge on the lecture posted by @awesononso. I hope you will like it.

Question 1

Explain private and public Keys in relation to custodial and non- custodial wallets.

To properly handle your crypto assets, for the most part two keys are needed. Those two keys are a Public key and a Private key. I will now be explaining how both these keys operate.

PUBLIC KEY: A public key is a key that shields the assets in a digital wallet. This key authorizes users to ingress their wallets. Through this access users can look after their cryptocurrencies. It is simple to obtain your public key from your private key. Any cryptocurrency can be sent to the public key. However, this key does not permit the usage of these currencies entirely. This is where the private key comes in.

PRIVATE KEY: Private keys must stay concealed because if a user loses their private key, they will lose all of their assets at once. Unfortunately, there is no way of getting the private key back. A Private key is often used to provide authentication of ownership. For example, if someone wants to send me a message, they will use my public key and publicly send me an encrypted message. To decrypt it, I will use my private key. That way the message will only be viewed by me. It is nearly unfeasible to acquire your private key from your public key.

CUSTODIAL WALLET: Unlike other wallets that do not involve any third party, a custodial wallet is a type of wallet that saves the assets after the cryptocurrency is bought through any centralized exchanges. The third party stores the assets on the user's behalf using the user's private key. The biggest example of this is a bank. Even though the money that is kept in the bank belongs to someone else, the bank keeps it safe for that person. However, the thought always arrives that the money can be used by this third party which is the only disadvantage as no one trusts a third party that easily. These centralized exchanges often also get hacked which puts the assets of the users in danger.

NON-CUSTODIAL WALLET: Contrary to a Custodial Wallet, a Non-Custodial Wallet does not involve any third party. The user is in full ownership of their wallet and can perform any activity or transaction with their assets. The user will also have full ownership over their private key. These assets can also be sent to other users by using the private key. If the user loses this private key, all assets will be lost with no chances of it being retrieved.

Question 2

What do you think about the Proof of Keys Day? What precautions would you take when participating?

On the 3rd of January, the Proof of Keys Day is celebrated to inspect whether the centralized exchanges are operating sincerely or not. To explain it better I would have you imagine an exchange that guarantees the safekeeping of their customers' money. The exchange claims that they However, what if the exchange is lying and they do not have as many funds as they say they have?

The Proof of Keys Day is an initiative for newcomers. It helps them get educated about everything concerning their assets. This informs them how their assets must be handled and also teaches them why their assets must be stored in a Non-Custodial Wallet instead of a Custodial Wallet.

The users should take some safety measures to keep their assets safe. I would keep my private key as safe as possible as it is impossible to transfer assets to a Non-Custodial Wallet without a Private Key. In the absence of the Private Key, all assets will be lost and there is no way to retrieve them. Users must also make sure to use the right memo and also use the right blockchain during the process.

Question 3

Do you prefer Centralized exchanges or Decentralized wallets for storing your cryptocurrencies? Why?

To store assets, the user must be familiar with how these exchanges work. Once familiarized, the user must choose the one they are more comfortable with. Some users may find it hard to manage their assets themselves, so they should most definitely choose a centralized exchange where a third party is willing to handle their assets for them.

I prefer using Decentralized Exchanges instead of Centralized Exchanges.

• The main reason being that I like to manage my assets and transactions myself with no one else being involved.

• Since the chances of getting hacked is higher in centralized exchanges. There is no way of getting my assets back if the exchange ends up getting hacked. I would rather choose a safer option.

• Information easily reaches the users in Decentralized Exchanges whereas in Centralized Exchanges, the information is passed through different stages before reaching the users.

• Decentralized Exchanges provide transactions at cheaper prices and at faster rates.

• With some Decentralized Exchanges, I can just connect my wallet to any DeFi platform and acquire many services.

All reasons mentioned above are my reasons to use a Non-Custodial Wallet instead of a Custodial Wallet.

Let us assume it is Proof of Keys Day:

a.)Transfer at least 20 Steem from your Binance wallet to your Steemit wallet.
b.) Transfer at least 50 TRX from your Binance wallet to your TronLink wallet.
(Provide Screenshots and make sure you have your Keys).

TRANSFER OF STEEM FROM BINANCE WALLET TO STEEMIT WALLET:

• Open your binance account and click on wallet.

• After clicking on wallet, you will see a page as shown above. Here, choose Steem in the options..

• On this page, enter your Steemit ID and the amount in their designated place. After choosing the network, click on withdrawal. A new window will pop open where you have to confirm your order. Click on confirm.

• The next window will show your withdrawal request being submitted.

• You can check in your history that the withdrawal has been done.

TRANSFER OF TRX FROM BINANCE WALLET TO TRONLINK WALLET:

• Open your TronLink Wallet and copy the address.

• In binance, click on wallet and click on Tron. Click on withdrawal.

• Paste the Wallet address in its designated place. Choose the network as Tron and write down the amount in the box. After filling in the boxes, click on withdrawal.

• Once again a confirmation page will open. Click on confirm to confirm the order.

• Your request will now have been submitted.

![image.png](

Question 4

In one statement, what is the major significance of the transfers.

The major significance of the transfers is to prove that a user can fully handle and also take care of their assets without any issue. It is also to show that the keys are being properly held by the users because without the keys, the assets will be lost.

CONCLUSION:

Keys have always interested me ever since I've joined this platform. In the time here I have come to learn a lot about the importance of keys. Thankfully, this homework made me learn much more regarding these keys and also regarding Proof of Keys Day. Not only that, I also deeply learned about the Custodial and Non-Custodial wallets and how they work.

Undoubtedly, this lecture was filled with valuable knowledge that I have now grasped. Thanking the professor @awesononso for sharing this informative lecture with us.

Thank you for reading this post!