First, let’s understand what cryptographic hash functions are and why they matter. Cryptographic hash functions take an input message (or data) and generate a fixed-size output called a hash value or digest. The hash function is designed to be one-way; it is computationally infeasible to reverse the process of generating the original message from its hash value. This property makes cryptographic hash functions ideal for securing blockchain networks, as they can provide proof of ownership and prevent unauthorized modifications without revealing sensitive information.

The most commonly used cryptographic hash function in blockchains is SHA-256 (Secure Hash Algorithm 256). It generates a 256-bit hash value from an input message. The output hash value is unique for each input message, and even the slightest change to the original message will result in a completely different hash value. This property ensures that any modifications made to a transaction on a blockchain network can be easily detected by comparing its hash value with the previously recorded one.

Another popular cryptographic hash function used in blockchains is SHA-512, which generates a 512-bit hash value from an input message. It provides stronger security than SHA-256 but requires more computational resources to generate and verify its output.

Cryptography plays a significant role in securing the consensus mechanism used by blockchain networks. In proof of work (PoW) systems, cryptographic puzzles are designed for miners to solve before adding new transactions to the network’s ledger. These puzzles involve generating hash values from specific input messages until one meets certain criteria. The first miner to find a valid solution is rewarded with newly minted coins and added to the blockchain network as a transaction verifier or node.

In proof of stake (PoS) systems, cryptography is used for selecting nodes that can participate in consensus decisions based on their staked assets. Nodes are selected randomly using a cryptographic algorithm called a random beacon. This ensures fairness and prevents any one entity from dominating the network’s decision-making process.

If you’re interested in learning more about blockchain security and its applications, check out our Certified Enterprise Blockchain Professional (CEBP) course on 101 Blockchains!