What Is Hashing

What Is Hashing?

In simple terms, a hash is a function that converts an input of letters and numbers into an encrypted output of a fixed length. A hash is an essential ingredient of blockchain technology. As you may recall, we discussed hashing during our conversation about cryptocurrency mining. Hashing plays a critical role in the mining process, as miners collect transactions and organize them into blocks.

The most important component of a cryptocurrency is the blockchain. We will discuss blockchain technology in a later section. For the purpose of our hashing conversation, it’s important to know that a blockchain is formed by linking together individual blocks of transaction data. To prevent fraudulent transactions, the blockchain only contains validated transactions. These validated transactions are a series of encrypted letters and numbers, known as a hash.

Hashing involves processing the data from a block through a mathematical function, thus creating a fixed-length output. This increases security based on the fact that anyone trying to decrypt the hash won’t be able to determine the length of the input based solely on the length of the output.

A great way to think of how hash functions work on a blockchain is that they act as a digital signature. For the next block to be made, the signature (hash) from the previous block MUST match that of the next block. This is why blockchain tech is considered so secure.

Cryptographic Hash Function

In addition to cryptocurrencies, hashing and hash functions are used across many industries. A cryptographic hash function is a special class of hash function that has unique properties making it well suited for cryptography. A cryptographic hash function contains three specific properties needed to ensure security. Let’s briefly review each property.

Deterministic

This means that you will always receive the same result no matter how many times you pass a particular input through a hash function. This property is very important because it becomes impossible to track the input properly if you receive different hashes.

Quick Computation

The hash function must be capable of returning the hash of input quickly and accurately. If the process isn’t fast enough, the system becomes inefficient.

Preimage Resistance

It is infeasible to find two different messages with the same hash value.

Summary

Without question, hashing is a difficult concept to understand. Thankfully, it’s not necessary for the average crypto user to fully grasp the idea of hashing. In reality, miners are the only people in the crypto community who work with hashing and hash functions daily.

Hashing and hash functions have been in existence well before Bitcoin arrived on the scene in 2009. Bitcoin (and cryptocurrency in general) has used hashing to create a decentralized money system that will one day be viewed by financial historians as arguably the greatest innovation in the history of money.

Brief Summary of Hashing

  • A hash converts an input of letters and numbers into a fixed-length encrypted output.
  • Hashing plays a critical role in the mining process.
  • Through hashing, miners are able to validate all transactions on the blockchain.
  • Hashing and hash functions are used across many industry groups.
  • A cryptographic hash function is a special class of hash functions with unique properties.
  • Cryptographic hashes are deterministic, quick, and have preimage resistance.

Leave a Reply

Your email address will not be published.