Public key encryption
Public key encryption is a type of encryption whereby a pair of keys, one private and one public, are used to perform data encryption and decryption. The public key can be published to third parties, and the private key is kept secret by the owner.
The main uses of public key encryption include digital encryption and signatures. For Bitcoin, public key encryption is used only for digital signatures.
The owner of a Bitcoin transaction creates a digital signature using his or her private key(s). A third party with the digital signature and public key can then confirm that the digital signature is valid and has not been tampered with, confirming the transaction was initiated by the owner.