What is an API key and how to use it safely?

Why API keys are needed and why they are critical for security

If you have ever integrated external services into your applications, you have certainly encountered API keys. An API key is a unique identifier — a set of characters and codes that allows applications to securely interact with each other. Essentially, an API key is a virtual pass for accessing confidential data and functions.

Keys perform two critically important functions. The first is authentication, which confirms the identity of the application or user. The second is authorization, which determines what access is granted after the identity is confirmed. Think of an API key as a combination of a username and password at the same time — it's your ticket to the secured part of the system.

How the API works and its relation to keys

API (Application Programming Interface) is a tool that allows different programs to exchange information. When you want to retrieve data from one service (for example, current cryptocurrency prices), you send a request through the API. This is where the API key comes into play.

Imagine a situation: application A wants to obtain data from application B. Application B generates a unique API key specifically for application A. Every time application A requests data from application B, it sends this key as proof of its identity. The API owner can see who, when, and what data is being requested. If the key falls into the hands of third parties, they will gain full access to all operations that the actual owner can perform.

API keys can be single codes or sets of multiple keys that combine together. This depends on the architecture of the specific system.

Cryptographic Signatures: Double Protection for Your Data

Some modern APIs use cryptographic signatures as an additional layer of protection. When data is sent through the API, a digital signature is added to it — a kind of electronic seal confirming the authenticity of the information.

The system works like this: the sender generates a digital signature using a special key, the receiver verifies this signature and ensures that the data has not been altered in transit and has indeed come from the expected source.

Symmetric and Asymmetric Encryption: What is the Difference

Cryptographic keys are divided into two categories based on their method of use.

Symmetric keys operate on a single secret code, which is used both for creating a signature and for verifying it. The main advantage is speed and resource efficiency. An example would be HMAC. The downside is that if the secret key is compromised, security is completely breached.

Asymmetric keys use two different keys: a private (secret) key and a public (open) key. The private key creates a signature, the public key verifies it. Even if the public key is known by the whole world, it is impossible to create a fake signature without the private key. A classic example is RSA encryption. This system provides a higher level of security as it separates the functions of generation and verification. Some systems allow an additional password to be added to the private key.

Why API Keys Are a Target for Cybercriminals

API keys provide access to sensitive operations: extracting personal information, conducting financial transactions, altering configurations. For this reason, hackers actively seek key leaks through compromised databases and vulnerabilities in code.

History has seen numerous cases of mass theft of API keys, leading to serious financial losses for users. The problem is exacerbated by the fact that many keys are issued with no expiration date — if a key is stolen, the attacker can use it indefinitely until the owner revokes access.

Five Practical Rules for the Safe Use of API Keys

Rule One: Regular Key Change

Similar to the recommendations to change passwords every 30-90 days, the same should be done with API keys. The process is simple: delete the old key, generate a new one. In systems with multiple keys, this does not create any particular issues.

Rule Two: Whitelist of IP Addresses

When creating a new API key, specify which IP addresses are allowed to use it. Additionally, you can create a blacklist of blocked addresses. This way, even if the key is stolen, a suspicious IP address will not be able to use it.

Rule three: use multiple keys

Do not rely on a single key for all operations. Create multiple keys, each with a limited set of permissions. One key may be designated only for reading data, while another is for write operations. For each key, set its own whitelist of IP addresses. This significantly reduces the risk: compromising one key does not mean compromising the entire account.

Fourth Rule: Secure Key Storage

Never store API keys in plain view, especially in the source code of the project or in public repositories. Use secret management systems, enable encryption. Do not leave keys on public computers or recorded in plain text files.

Fifth Rule: Absolute Confidentiality

An API key is your word. Sharing the key with a third party is equivalent to sharing the password to your account. The third party will have all the same rights and capabilities as you. If you even suspect a leak, immediately deactivate the compromised key.

What to do in case of key leakage

If the key has fallen into the wrong hands and financial losses have occurred, take the following actions:

First, immediately disable the compromised key in the admin panel to stop further damage.

Second, gather evidence: screenshots of transactions, access logs, information about the time and amounts of losses.

Third, contact the technical support of the service where the leak occurred, providing all the collected information.

Fourth - file a report with law enforcement. This increases the chances of recovering funds and helps track down the criminals.

Final Recommendations

API keys what are they in the context of security - they are both a necessary integration tool and a potential vulnerability. Treat them as the most valuable passwords of your account. Implement multi-layered protection: regular changes, IP restrictions, permission separation, cryptographic encryption during storage. Remember that the entire responsibility for the security of the keys lies with the user. One compromised key can cost you significant financial losses, so take this seriously.