You may have heard about Hash and Hash Function in many cryptocurrency conversations. To have a general idea we must know that a Hash is the result of a Hash Function. Hash Functions are a type of cryptographic operation created, so they would be unique identifiers. These identifiers are derived from the information taken from each blockchain block.
The main objective of Hash functions is the encoding of data to create a unique string of characters. A function can be created regardless of the amount of data implemented in it. These hash functions are used mainly in blockchain technology, providing greater security to it.
Therefore, a cryptographic hash function, usually known as a “hash”, is a mathematical process that transforms any type of data, regardless of its size, into a new series of characters with a fixed and unique length.
In fact, if you have seen any official document signed with an electronic signature, you may have already encountered this type of code in one of the margins or at the bottom of the document. Thus, an example of a hash could be a code of this type: 9c8245e6e0b74cfccg97e8714u3234228fb4xcd2.
Real-world examples where we use hash functions
- To examine similar data and locate modified files, cloud storage servicesuse hash tasks.
- To distinguish records in a store, the Git version control frameworkuses hash capabilities.
- In its proof-of-work programs, Bitcoinuses a hash algorithm.
- Forensic expertsuse hash values to ensure that digital objects have not been moved.
- To identify data suspected of being malicious passing through a network, NIDSuses hashes.
Definition and characteristics of the hash function
The hash functions used in modern security and technology must meet very strict properties to be considered effective:
|
Characteristic |
Concept |
Detail and application (Function) |
| Fixed length | Determinism of the output | No matter if the input is 5 letters or 5 GB, the result (the hash) will always have the same defined length (e.g., 64 characters in SHA-256). |
| Uniqueness / irreversibility | The “Fingerprint” | Changing a single bit in the input (a comma for a period) produces a completely different hash. It is fundamental for verifying data integrity. |
| One-way function | Cryptographic irreversibility | It is not possible (in theory) to obtain the original data through the result of a Hash Function. Thanks to this, Hashes are totally secure. |
| Uniqueness / collision resistance | Strong integrity proof | This means that it is not possible to calculate a Hash that leads us to another equal Hash. These are called pre-image and second image, concepts from which hash security derives. |
| Avalanche effect | Sensitivity to change | This means that, in the event of any minimal change in the data input, a Hash different from the original will be generated. If only one character is changed (“Mi Casa” vs. “Mi Caza”), the resulting hash is completely different. |
| Preimage resistance | Password protection | Property that guarantees that the original password or message cannot be obtained from the stored hash value. |
| Use of Salt (Salt Value) | Security improvement | A random and unique data string that is added to the password before hashing it. It prevents rainbow table attacks, making identical passwords produce different hashes for each user. |
Practical applications of hash functions
‘Hash’ functions and codes shine in the field of cryptography, where they have great utility in various applications.
- Protection and security of passwords. Instead of storing passwords in plain text in a database, organizations store password ‘hashes’. When a user attempts to log in, the system calculates the ‘hash’ of the entered password and compares it with the ‘hash’ stored in the database. If the ‘hashes’ match, access is granted.
- Verification of data and multimedia content integrity. When transferring files or storing information in a system, a ‘hash’ value of the original data is created. This ‘hash’ accompanies the data during its sending or is stored alongside it. Upon reaching its destination, or when its integrity needs to be verified, the ‘hash’ is recalculated and compared with the original value. A match between both ensures that the data remains unaltered.
- Malware detection and unique fingerprints. ‘Hash’ codes are also used to detect certain malicious programs and eliminate them, which is why it is a technology very present in the antivirus industry.
- Digital signatures and authentication. They create a unique digital fingerprint of a document. This guarantees that the content has not been altered since it was signed, fundamental for trust in digital communications.
- Blockchain and cryptocurrencies. Each block of transactions is linked to the previous one by its hash, creating an immutable chain. Mining involves solving a hashing puzzle, securing the network.
- Data storage. Database management systems often use hashes to speed up data search and access. Hash-based indexes allow for quick searches in large databases.
The role of hash in blockchain and cryptography
The Hash is not just a security tool, it is the logical backbone that allows disruptive technologies like Bitcoin and Blockchain to function without a central authority. In the cryptographic ecosystem, the hash, driven mainly by algorithms like SHA-256, fulfills a dual essential function: guaranteeing the immutability of the chain (integrity) and providing the consensus mechanism (security).
Immutability is guaranteed because the hash is what irrevocably links the data blocks of a Blockchain, creating a chronological and tamper-proof record. Each block of transactions is processed through a hash function to generate a unique identifier, which acts as a checksum or cryptographic summary of all the block’s content. The crucial part is that each new block that is created contains the hash of the immediately previous block.
If an attacker tried to alter a transaction in an old block, the hash of that block would change instantly. By changing the hash of the old block, the hash of the next block would automatically be invalidated, breaking the entire chain and making any fraud attempt immediately evident to all network participants. This ensures the integrity and validity of all historical transactions.
In blockchains like Bitcoin, the hash not only verifies, but also drives the mechanism to create new blocks, known as Proof of Work (PoW). The challenge consists of miners having to find a random number, called a Nonce, which, when combined with the block data and the SHA-256 function applied to it, produces a hash that meets a strict requirement, generally starting with a large number of zeros.
This process works as a random oracle model, where the only way to find the solution is through trial and error, trying millions or billions of combinations, which requires enormous computing power. This intensive calculation imposes a cost (time and electricity) to add a block, which becomes the main defense against malicious attacks.
Once a miner finds the correct Nonce, the hash fulfills its second key function in PoW: fast verification. It is instantaneous and trivial for the other nodes in the network to verify that the resulting hash is valid, ensuring consensus efficiently.
Furthermore, the hash protects individual operations: transactions are digitally signed using the hash of the transaction, ensuring that any minimal change in the details (such as the amount or recipient) invalidates the signature.
The use of the hash, due to its speed, efficiency, and uniqueness, is not only fundamental for cryptocurrencies, but also for broader security systems, such as web certificates and version control in software projects like Git, where it guarantees the immutability and traceability of the code.
Recent technologies and advances in hash in 2025
In 2025, advances in hashing focus on hardware efficiency, integration with artificial intelligence and quantum computing for security, and decentralization, with improvements in digital identity protocols and the optimization of cryptocurrency mining for a record hash rate, despite regulatory and energy consumption challenges. Faster and more secure hash functions are being sought, combining ECC and sponges, and systems like World ID are being implemented that fragment keys to avoid centralized points of failure, crucial against quantum threats.
| Advances in mining and hardware | High-efficiency ASICs: New, more efficient chips reduce energy consumption per terahash, driving Bitcoin’s hash rate to record levels (exceeding 900 EH/s in May 2025). Renewable Energies: Greater integration of mining with sustainable sources to reduce costs and environmental footprint, making renewables a majority source of mining energy. Concentration in Pools: Large pools dominate the hash rate, centralizing resources but increasing network security through collaboration. |
| Security and cryptography | Quantum Resistance: Development of “quantum passwords” and hash functions resistant to quantum computer attacks, anticipating a future risk. New Algorithms: Proposals for hash functions that combine ECC and sponges for secure, low-latency communication (e.g., for real-time messaging). Decentralized Digital Identity: Systems like World ID fragment and distribute public keys across multiple institutions, eliminating the risk of centralized servers. |
| Applications in AI and digital transformation | Drug discovery, using hashing for data integrity. AI and Hashing: AI is used to analyze health data from IoT devices and accelerate… Hybrid Data Centers: Mining companies are converting into infrastructure providers for AI and HPC, using the same high-power infrastructure. |
| Challenges and trends | Regulation: Regulations seek greater transparency and accountability, driving the adoption of clean sources. Efficiency vs. Complexity: Algorithms like SHA-256 remain robust, but improvements in efficiency and confidentiality are being sought, as they do not encrypt data by themselves. |
Hash and electronic signature
Hash code generation technology is a key element in electronic signature tools. In reality, the hash is the pillar of the security and integrity of the electronic signature. Together, they guarantee that a digital document was not only signed by a specific person, but that it has not been altered since the moment of signing, which confers legal validity. We will take a simple tour of the electronic signature process for a document:
- Hash generation. First, the hash generation algorithm is applied to the document to be signed and sent. Therefore, in this process, a unique hash codewill be generated from a predetermined algorithm, which unequivocally identifies said document.
- Signing and encryption. Next, in the signing process, that hash code is encrypted using the signer’s private key.
- Sending. The signed document is sent to its recipient, together with the encrypted hash and the signer’s public key.
- Reception and verification. At the moment the document is received by the recipient, three operations are performed:
- Generate a new hash code from the sent document, using the same algorithm.
- Use the signer’s public key to decrypt the sent hash.
- Compare both hashes. If they match exactly, the signature is considered valid and the document has not been altered after its signing.
By the way, the use of cryptographic hash algorithms, such as SHA-256, is essential to prevent attacks:
- Collision attacks. A successful collision attack occurs if an attacker can find two different documents that generate the same hash. This would allow them to replace a legally signed document with a malicious one without the hash verification detecting it.
- Dictionary attack: These attacks are mainly directed at passwords, not at the digital signature of documents.
The evolution continues
Hashing is a fundamental piece in blockchain, providing the cryptographic foundation that makes this technology a secure and reliable solution for digital transactions and data management. Despite weaknesses such as collision attacks, research and development in hashing and blockchain security continue to advance to overcome these challenges.
With the maturation of blockchain technology and its expansion into new fields, hashing will continue to be essential, ensuring that blockchain systems remain secure, transparent, and reliable for digital transactions and data management.
Or as Vint Cerf indicates: “In a world of perfect digital copies, proof of integrity must be mathematically irrefutable. That is the enduring role of the hash.”
To conclude, with such a solid cryptographic foundation, blockchain technology is ready for mass adoption and user empowerment. As Bitnovo summarizes it: “Your crypto, your rules. Start in 3 minutes.”
