Key derivation in HD wallets using the extended private key vs hardened derivation
I am reading the book Mastering Bitcoin and confused about wallet key derivations in Chapter 4. Keys, Addresses, Wallets.
The book first mentions a private child key derivation where the child private key is derived from three inputs: (parent public key previously derived from parent private key, parent chain code, index).
Next, the book discusses extended keys and mentions two types: extended private keys and extended public keys.
The extended public keys are used to derive children public keys from parents public keys to avoid exposing the private keys, hence more secure. This is the block diagram for the extended public key.
On the other hand, the book mentions that the extended private key is used to derive a child's private key using the parent's private key and chain code.
However, although the extended public key does not expose the private key, it is still risky to use since it exposes the chain codes. If a private key is leaked, they can be used together to derive other children key.
Finally, the book suggest to use the hardened key, which to me is exactly the same description as the extended private key.
My question first question is, is the extended private key the same thing as the hardened key derivation?
My second question is, which technique is actually used when deriving the private key for children, the first one I mention in my question or the second one using the extended private key which to me is the same exact thing as the hardened key derivation.
http://ift.tt/2AzoNSp
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