Matrix hashWhat in the world is this “SHA-256” that’s floating around? What even is it and why does anyone care? Have you ever stopped and pondered over how your passwords are kept secure when you make an account on some random website? Or maybe how digital signatures are verified and kept from being tampered with?

SHA-256 is the answer to all of these questions, a cryptographic hash function that is absolutely vital in securing data in a ton of different applications.

History

Back in the day, the United States National Security Agency created a set of cryptographic hash functions called SHA-2. One of those functions was SHA-256, which was introduced in 2001 as a way to replace the less secure SHA-1 algorithm. SHA-1 just wasn’t cutting it anymore and stronger encryption was needed to keep sensitive data secure. SHA-256 was made to be more robust and resistant to attacks, making it the perfect choice for safeguarding data in a wide range of applications.

What’s It All About?

SHA-256 stands for “Secure Hash Algorithm 256-bit” and it’s the bomb when it comes to cryptographic security. Cryptographic hash algorithms create unique, irreversible hashes. The more possible hashes there are, the less likely it is that two different values will create the same hash. That’s just straight-up security, yo!

Why Do We Need It?

Why use SHA-256, you ask? Well, because it provides a way to authenticate data and ensure that it’s not been tampered with or changed in any way. This is super important for a bunch of different applications, from securing online transactions to keeping super sensitive data in government and military settings totally protected from prying eyes.

Usage

SHA-256 gets used in all sorts of different applications, and here are some real-life examples of how it’s used to keep data totally secure:

Passwords: When you make an account on a website, your password is usually kept in a database. To keep your password from getting jacked, the website hashes it with SHA-256 before storing it. This makes it way harder for hackers to steal your password because they would need to know what the original password was to even log in.

Digital Signatures: When you digitally sign a document, your signature gets created using a hash function like SHA-256. This creates a one-of-a-kind “fingerprint” of your signature that can be used to verify that it’s real. If someone tries to mess with the document after you’ve signed it, the hash value will change, letting people know that the signature is no longer legit.

Bitcoin Relation

Perhaps the most well-known use of SHA-256 is in the Bitcoin network. Each block in the blockchain is totally secure thanks to SHA-256, which makes sure that all the transactions are on the level and no one’s messing with them. SHA-256 gives a 256-bit hash value, which is unique to the input data (in this case, Bitcoin transaction data).

Hash functions take any input of any size and generate a fixed-size, totally unique output that is virtually impossible to recreate the original input from. SHA-256 is designed to be irreversible, which makes it perfect for verifying and keeping the Bitcoin blockchain secure and untampered with.

The Bitcoin network uses SHA-256 to guarantee that transactions on the blockchain are totally legit. As miners verify transactions on the blockchain, they use specialized hardware called ASICs (Application-Specific Integrated Circuits) to do the computations required for SHA-256.

Thanks to SHA-256, the Bitcoin network can make sure that each block of transactions is free from tampering or manipulation. Without the secure encryption offered by SHA-256, the Bitcoin network would be vulnerable to nefarious activity and pose a significant threat to the integrity of the entire blockchain. By implementing this cutting-edge technology, the Bitcoin network ensures that transactions are secure, reliable, and effectively protected from malicious actors seeking to corrupt or compromise the blockchain.

By Nathan Harris

Nathan is a long-time investor in crypto and a co-founder of PandaVana.com.