Hash/Cryptographic Hash Function

A hash is an encrypted string of alphanumeric characters that registers a unique place on a blockchain. The string of alphanumeric characters has a fixed length and structure that is generated when an input string of any length—such as a block of transactions on a blockchain—is run through a mathematical algorithm called a cryptographic hash function. Hashing is performed by the nodes of a blockchain and is a one-way function—if you put the same data in, you will arrive at the same unique string, but you cannot reverse the function and decipher the input data based on the hash. While hash functions have been used in cryptography for decades, they are used in blockchains for a number of key purposes, including to derive addresses for users, to keep track of particular transactions, to store large amounts of data more economically and, importantly, to connect blocks in a blockchain (i.e., each block contains a hash of the previous block). Different blockchains may use different hashing algorithms—Bitcoin, for example, uses the SHA-256 hash algorithm.