Hash

In crypto parlance, a hash is a fixed-length string of letters and numbers created by putting any kind of data through a special mathematical function called a hash function. This data can be in the form of a transaction, a block of transactions, or even a password. It can be looked at like a super secure digital fingerprint.

So no matter how big and large the original data is, the hash will always be the same short length. In the case of Bitcoin its 64 characters. This is even if the data is a long sentence or an entire movie file. But remember even the tiniest change in the input can create a completely different hash. Moreover, you can never reverse-engineer the original data just by looking at the hash, which means it’s only a one-way street.

So if you are wondering where are they used, remember that every time you send crypto, the details like the amount, sender, receiver, etc. are hashed to create a unique transaction hash also denoted as txID. This is what you see on a blockchain explorer. Miners collect these transactions, combine them with other data and hash everything together to produce the block hash.

Truth is, stumbling upon a valid block hash during Bitcoin’s mining process is incredibly tough and is basically a brute-force race that eats up a ton of power, but that’s exactly what keeps the whole chain from being messed with. It’s the same deal with your public wallet address. That’s essentially just a hashed version of your public key, acting as a clever layer of privacy that lets anyone verify a transaction without ever touching your actual sensitive info.