Blockchain Hashing Explained
Hashing is essential to cryptography and blockchain. A cryptographic hash function is applied to a text message, image, or file of nearly any size. A message digest, digest, hash digest, hash value, or hash is a fixed-length string of characters produced by this mechanism. These characters are frequently represented alphanumerically (such as hexadecimal). The output hash is always the same length, regardless of the size of the original input.
The following are the main attributes and features of cryptographic hash functions:
- Deterministic: No matter how many times it is computed, the hash function will always yield the same output hash for the exact same input data.
- Fast Computation: Hash functions are made to calculate from the input data quickly and efficiently.
- Pre-image Resistance (One-way): Determining the actual input data is either practically impossible or computationally impractical given just the output hash. They are one-way functions because of this characteristic.
- Second Pre-image Resistance: It is nearly hard to compute a new input (m) such that h(m) = h(x) given a certain input (x) and its hash (h(x)). Another name for this is poor collision resistance.
- Collision Resistance: Finding any two distinct input values (x and z) that result in the same hash output (h(x) = h(z)) is computationally impractical. Strong collision resistance is another name for this characteristic. Although collisions between infinite inputs and finite outputs are theoretically possible, they are computationally impossible to detect due to a powerful hash function.
- Avalanche Effect: An entirely distinct output hash digest will be produced by even the slightest alteration to the input data, such as altering a single bit or capitalization.
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Purpose and Applications of Hashing
There are several uses for hashing:
- Data Integrity and Verification: By separately taking input data, hashing it, and coming up with the same result, hashing enables someone to demonstrate that the data remained unchanged. The hash value will vary in response to a change in the input. For this reason, a hash is frequently referred to as the data’s digital fingerprint.
- Password Storage: Frequently, websites save a user’s password hash rather than the actual password. When logging in, the password is hashed and compared to the stored hash. This makes it harder for hackers to retrieve passwords after accessing the database.
- Creating Unique Identifiers: Various data items can be uniquely identified through the use of hashing.
- Message Authentication: A message’s authenticity and integrity may be checked using hash functions. They create Hash-based MACs (HMACs) or Message Authentication Codes (MACs) when paired with a key.
Common Hashing Algorithms
Blockchain technology uses a variety of cryptographic hash algorithms, including:
- SHA-256: It is a member of the SHA-2 family and generates an output of 256 bits (32 bytes). SHA-256 is widely used by Bitcoin, especially in its Proof of Work system.
- Keccak-256 / SHA-3: NIST decided to use Keccak as the foundation for the SHA-3 standard. Keccak-256 is used by Ethereum.
- RIPEMD-160: Used to derive addresses in Bitcoin.
- MD5: Although it is mentioned as a checksum algorithm, its application is limited to less important integrity checks due to security flaws.
- SHA-512: An additional SHA-2 family algorithm that generates a 512-bit output.
- Ethash: Ethereum uses the hashing-based Proof of Work mining method.
Hashing in Blockchain
Hashing is essential to the operation and security of blockchains:
Chaining Blocks: By including the hash digest of the preceding block’s header into the header of the current block, blocks are essentially connected. This starts a chain where changing a historical block would cause its hash to change, rendering the hash in the block after it and all subsequent blocks invalid. This adds to the blockchain’s immutability and makes it tamper-evident.
Merkle Trees: Usually, a block’s transactions are arranged in a Merkle tree. This data structure combines transaction hashes iteratively until a single Merkle root is generated. The block header contains the Merkle root. Because just the Merkle root and a selection of intermediate hashes are required, rather than all of the transactions in the block, this enables effective confirmation of whether a particular transaction is part of the block.
Proof of Work (PoW): Hashing is at the heart of the “puzzle” that miners must solve in PoW consensus systems. By altering a variable known as the nonce, miners continually calculate the hash of the block header (which contains the hash of the previous block, the Merkle root, the date, etc.) until the resultant hash satisfies a predefined criterion, usually being less than a predefined difficulty goal. The “work” that demonstrates a miner’s eligibility to suggest the next block is this computing effort. The general hash rate of the network, or how quickly miners compute hashes, makes it harder to identify a genuine hash.
Address Derivation: SHA-256 and RIPEMD-160 for Bitcoin and Keccak-256 for Ethereum are examples of hash algorithms that are used to extract shorter public addresses from users’ public keys.
Digital Signatures: Before using a private key to digitally sign data, hashing is a typical preprocessing step. This guarantees that the signature has a set size and that any modifications to the original data will be instantly noticeable when the signature is verified.
Data Privacy and Security in Smart Contracts/DApps: By hashing the data and a secret password, smart contracts may employ hashing to protect the privacy and security of certain data attributes. By using this method, the hash may be kept on-chain while the actual data is kept secret until it is time to expose it and compare it to the hash that has been recorded.
Although hashing is essential for data security and integrity, it is typically not utilized for classical encryption, which renders data unintelligible without a key. Nonetheless, it is an essential part that is utilized in conjunction with encryption and other cryptographic methods.
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