Hash's Explained!

In our world, technology has allowed keeping track of anything & (everything) easier. Though many businesses, non-profits, and governments still use manual ways of collecting data, Blockchain has provided some different solutions. Blockchain companies have multiplied dramatically attempting to create tools called protocols, or use tools to solve other companies issues. This technology has been proven to upgrade data tracking, sending digital assets, and provide transparency on parties involved.

Bitcoin was introduced in 2009, as a way of sending money through a system that is public for the world to see. (maybe explain.) This public system is what made it so unique and transparent. Many people thought that since Bitcoin was used for illegal purposes that it was not transparent a.k.a anonymous. Looking at Bitcoin’s core, you will see why this is not true. Hash functions are what bitcoin is dependent on, but first, let me explain what a ledger is. In any business a ledger is a book of information that organizes anything from transactions, employees, produce/stock, etc. Bitcoin uses a public ledger system that posts all transactions that are occurring and have occurred. This can be found on https://blockexplorer.com/blocks where it shows you all the blocks that have been approved within a certain time period.

A hash is the fundamental piece of a blockchain, which you can compare it to atoms. It is a function that can take a piece of data (of any size) and it provides an output with a specific size. The output is what is known as a hash, the function is essentially processing it. Imagine all receipts (take out comma) for McDonald’s were barcodes rather than a detailed description of what you ordered. That barcode has a hash identity, which would look something like this (0x34GF23WE24FJGNSK35343F0897124D). (maybe bold the hash identity) This barcode would identify your order, rather than a long piece of paper. So your order would be able to be scanned and it would identify that it is your food (McMuffin with no cheese and 3 orders of hash browns with a side of hot sauce) not the person behind you who just ordered coffee.

Bitcoin’s hashing algorithm is called SHA-256 (Secure Hashing Algorithm 256) (maybe bold again) and has provided a simpler process to send and receive information. Whether you send $5 in Bitcoin or $500,000, the output of the transaction (receipt) is still going to look like a random collection of letters and numbers. Simply Bitcoin is revolutionary because it made sending money transparent and accessible globally. It is important to understand the core of Bitcoin before you start using it because it is not just an investment, but also a tool. Due to Bitcoin’s success, other Blockchain products have been developed creating other solutions Bitcoin does not have. The hashing component of Bitcoin creates the randomly generated output that is always the same length. Even a small smiley face :) would have an output that looks like this G2FQ34GF23WE24FJGNSK35343F0897124D. (maybe bold)

This cryptographic hashing is what gives Bitcoin leverage in transparency. What makes it unique are the characteristics (Deterministic, quick computation, pre-image resistance, a small change in input changes the output, collision resistant, and puzzle friendly.). This is what separates hash functions from Bitcoin’s SHA-256 algorithm. For more information watch this short video!

https://www.youtube.com/watch?time_continue=42&v=IGSB9zoSx70