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In this episode of “Bitcoin, Explained”, hosts Aaron van Wirdum and Sjors Provoost go back to bitcoin basics. They explain one of the most fundamental building blocks of all Bitcoin: hash functions.
To start the episode, van Wirdum and Provoost explain that hash functions are a type of one-way mathematical function. This means that they can easily convert one piece of data into another piece of data – a hash – but it’s impossible for anyone who only knows that hash to convert it back to the original data. Moreover, a hash is supposed to be unique: two (different) pieces of data should not give the same hash. If any of these things are no longer true, a hash function is considered broken.
Next, van Wirdum and Provoost explain in a bit more detail how hash functions actually work. They discuss some aspects of the history and evolution of different hash functions, mention some hash functions that have actually been broken over time, and identify hash functions used in Bitcoin.
Finally, van Wirdum and Provoost explain exactly how hash functions are used in Bitcoin. They point out that this includes almost every aspect of the Bitcoin system, ranging from transactions (in many ways) and blocks to addresses and the proof-of-work mechanism, as well as in relatively new upgrades like Taproot. Hash functions are even used to create some randomness needed to establish connections on the peer-to-peer network.
Listen to the entire episode to learn more about hash functions.