Hash functions are functions which process an input and produce a unique output which is almost impossible to reverse. It therefore creates a unique signature which does not resemble anything else.
Hash functions are used in bitcoin where the initial input (transaction) is the processed by the function and produces a unique output which can then be added to the blockchain. The hashing algorithm is known as SHA-256 which is an alphanumeric code that allows an output of a fixed length.
What does it mean when we say that hash functions need to be collision resistant? (We didnât use the term âcollision resistantâ in the lecture, but you will easily find this on Google, we add this question intentionally to make you research information on your own, thatâs how you learn best).
Hashing functions need to be collision resistant because otherwise it would be possible and likely that two different inputs can produce the same output. If this was possible in bitcoin, it would lose its entire purpose. Therefore cryptographic hash functions needs to be collision resistant.