SHA-256 is a cryptographic hash function used in various cryptocurrencies including Bitcoin and Litecoin. It stands for Secure Hash Algorithm 256-bit. It takes an input (such as transaction data) and produces a fixed-size string of characters as output.
SHA-256 is utilized for hashing blocks of transactions in a blockchain, ensuring data integrity and security. Each block contains the hash of the previous block, forming a chain of blocks. This hashing algorithm is crucial for maintaining the decentralized and transparent nature of cryptocurrencies.
In the context of cryptocurrency, SHA-256 is used for mining, a process where miners solve complex computational puzzles to validate transactions and add them to the blockchain. Miners compete to find the correct hash value that meets the network’s criteria.
SHA-256 is considered secure and has a low collision probability, making it difficult to reverse engineer the original input from the output hash. This makes it ideal for ensuring the immutability and tamper-resistance of blockchain data.
