what is hash in blockchain with example

What is Hash in Blockchain?

A hash is a cryptographic function that converts a large amount of data into a fixed-size alphanumeric string known as a hash value or hash digest. In the context of blockchain, hashing plays a crucial role in ensuring data integrity, securing transactions, and linking blocks together.

1. Data Integrity

Hash functions are designed to be one-way, meaning that it is computationally infeasible to reverse a hash value and obtain the original data. Once data is hashed, any changes to it will result in a completely different hash value. This property makes hashing an effective tool for verifying the integrity of data stored on a blockchain.

2. Transaction Security

In a blockchain network, transactions are grouped into blocks and secured using a hash function. The hash of the current block includes the hash of the previous block, creating a chain of blocks. If an attacker attempts to alter a transaction in a previous block, the hash of that block will change. This, in turn, will invalidate the hash of the subsequent blocks, making it easy to detect and reject the altered transaction.

3. Block Linking

Hashing plays a vital role in linking blocks together on a blockchain. The hash of a block serves as a unique identifier for that block. When a new block is created, its hash includes the hash of the previous block, establishing a chronological order and preventing attackers from tampering with the blockchain history.

Example of Hashing in Blockchain

Consider the following example:

1. Data: A transaction between Alice and Bob where Alice sends 100 BTC to Bob's address.
2. Hash Function: The SHA-256 hash function is used to convert the transaction data into a hash value.
3. Hash Value: The SHA-256 hash value for the transaction is:

0x67778eb314f219626e36599543346e0b49f8d33bddabbfbd80dba1936c4d4b3d

4. Block: The transaction is included in a block along with other transactions.
5. Block Hash: The hash of the block is calculated, which includes the hash of the previous block and the transaction hashes.

The block hash now serves as a unique identifier for the block and helps maintain the integrity and chronological order of the blockchain.