The purpose of a digital signature in online transactions is to provide a secure way to verify the authenticity and integrity of digital messages or documents. It functions like a handwritten signature, ensuring that the sender is legitimate and the content has not been altered during transmission. Digital signatures utilize cryptographic techniques to create a unique code that links the signature to both the signer and the document. This assurance of authenticity enhances trust in electronic communications and is essential for secure online transactions, contracts, and communications across various industries.