What Algorithm Uses Digital Signature?

In today’s digital age, security, identity authentication, and data integrity are major concerns for businesses, governments, and individual users alike. One highly trusted method to maintain the authenticity and integrity of digital information is through digital signatures. But behind every digital signature, there’s a specific cryptographic algorithm at work. This article will explore what algorithm uses digital signature, how it functions, and which types are commonly used in industries—especially under the compliance of local regulations such as the Electronic Signatures in Global and National Commerce Act (ESIGN Act) and the EU’s eIDAS Regulation.

What Is a Digital Signature?

A digital signature is a cryptographic technique used to validate the authenticity and integrity of a digital message, software, or document. It serves as a digital equivalent of a handwritten signature or a stamped seal, but it’s far more secure. A digital signature provides three main security assurances:

1. Authentication – Verifies the signer’s identity.
2. Integrity – Ensures the message has not been altered.
3. Non-repudiation – Prevents the signer from denying their involvement.

These features make digital signatures widely used in a variety of applications, from software code signing and email communication to secure document signings, including contracts and legal documents.

The Algorithms Behind Digital Signatures

So, what algorithm uses digital signature? In essence, multiple cryptographic algorithms are at the heart of digital signature systems. Each algorithm combines elements of public key cryptography (asymmetric encryption) and secure hash functions. Below are some of the most commonly used digital signature algorithms:

1. RSA (Rivest–Shamir–Adleman)

RSA is the most classic and widely used public-key cryptosystem. Introduced in 1977, RSA is used for both encrypting data and conducting digital signatures. It works as follows:

• A private key is used to sign the message.
• A corresponding public key is used to verify the signature.

RSA uses a hash function to produce a hash value from the content being signed. This hash is encrypted with the private key to generate the signature, ensuring authenticity and preventing tampering. RSA is recognized under several national and international standards, including FIPS 186 under U.S. federal laws.

2. DSA (Digital Signature Algorithm)

The Digital Signature Algorithm, developed by the U.S. National Security Agency (NSA), was adopted as part of the Digital Signature Standard (DSS) in FIPS PUB 186. DSA is not patented and is freely available for use.

DSA operates differently from RSA but still uses public and private keys. It is often used in U.S. government applications where FIPS compliance is required. The algorithm includes variable key lengths, now supporting up to 3072-bit keys under FIPS 186-3, offering strong security while meeting U.S. regulatory requirements.

3. ECDSA (Elliptic Curve Digital Signature Algorithm)

ECDSA is a variant of DSA that uses elliptic curve cryptography (ECC). Elliptic curves offer smaller key sizes relative to RSA and regular DSA, which translates to faster processing and reduced storage requirements. Due to these advantages, ECDSA is increasingly adopted in mobile and IoT applications, where resource usage is critical.

Moreover, ECDSA is approved under the same FIPS standards and is often used in jurisdictions that require compliance with modern cryptographic regulations such as the NIST standards and the EU’s eIDAS Regulation for digital identification and trust services.

4. EdDSA (Edwards-curve Digital Signature Algorithm)

EdDSA is a newer algorithm designed to achieve high performance and resistant to several types of cryptographic attacks. It is growing in popularity due to its speed, security, and suitability for high-throughput systems. The most popular variant, Ed25519, uses the Curve25519 elliptic curve and provides both speed and security.

Countries like Germany and France actively support cryptographic research that includes EdDSA, highlighting the trend of complying with both local and cross-border standards in data protection and identity verification.

Compliance with Local Regulations

Different countries and regions enforce specific standards and legal frameworks regarding the use of digital signatures. These guidelines impact which algorithms are accepted and how they must be implemented.

1. United States – ESIGN Act and UETA

The U.S. recognizes digital signatures under the ESIGN Act (Electronic Signatures in Global and National Commerce) and the Uniform Electronic Transactions Act (UETA). The ESIGN Act doesn’t specifically mandate a type of algorithm but implies the use of a “secure” method to ensure identity authentication and integrity.

For companies aiming for federal-level contracts or operating in heavily regulated sectors like healthcare and finance, using FIPS-approved algorithms like RSA, DSA, and ECDSA is vital.

2. European Union – eIDAS Regulation

Under the eIDAS Regulation (EU Regulation No. 910/2014), the EU distinguishes between:

• Electronic signatures
• Advanced electronic signatures (AdES)
• Qualified electronic signatures (QES)

Qualified signatures require signatures based on qualified certificates issued by a Trust Service Provider (TSP). Algorithms such as ECDSA and RSA backed by secure hardware (HSMs and smart cards) are typically employed to comply with this regulation.

3. Asia-Pacific – Local Government Standards

Countries like Japan, South Korea, and Australia have also adopted electronic signature laws aligned with UNCITRAL guidelines. For instance, Australia’s Electronic Transactions Act 1999 provides flexibility while giving precedence to integrity, authenticity, and reliability. ECDSA is often endorsed due to its high efficiency.

Hash Functions in Digital Signatures

In addition to the encryption algorithm, a digital signature also uses a secure hash function, such as:

• SHA-2 (Secure Hash Algorithm 2)
• SHA-3 (Secure Hash Algorithm 3)

SHA functions are responsible for transforming input data into a fixed-size hash value. Signing a hash rather than the entire message speeds up the process and increases security.

Most sanctioned cryptographic standards today require SHA-256 or higher, particularly in government and financial applications.

Why Algorithm Choice Matters

Choosing the correct algorithm is critical for compliance and long-term security. Outdated algorithms can expose systems to vulnerabilities. For instance, SHA-1 is now deprecated by most institutions due to known collision risks. Likewise, RSA key lengths below 2048 bits are considered insecure.

Regulatory bodies, including NIST, often update their recommendations as computing power and threat models evolve. Organizations need to stay informed of these changes to remain compliant and mitigate legal and cybersecurity risks.

Final Thoughts

Understanding what algorithm uses digital signature is vital for ensuring data security and meeting legal obligations in today’s global economy. Whether it’s RSA, DSA, or ECDSA, the algorithm you select has significant implications in terms of compliance with local regulations like the ESIGN Act in the U.S. or the eIDAS Regulation in Europe.

With increasing reliance on digital transactions and cross-border communications, aligning your digital signature algorithm with industry best practices and regulatory standards isn’t just a best practice—it’s a business imperative.

By choosing the right digital signature algorithm, organizations can not only protect their data but also gain the trust of their customers and legal systems across jurisdictions.

For peace of mind, always ensure your digital signature solution is powered by algorithms that are up to date, compliant, and recognized by regulatory frameworks relevant to your region.