What does SHA 256 mean?
The abbreviation SHA 256 is a function that forms the core of cryptocurrencies such as Bitcoin, Bitcoin Cash and Bytecoin. This hash function belongs to the group of SHA 2 functions. SHA is an abbreviation for Secure Hash Algorithm.
A hash function is a one-way function that converts strings of any length into strings of uniform length. This is used, among other things, to check the integrity of files.
Origins of the SHA 2 functions
The functions were commissioned by the US standardization authority NIST. In 1991, the US Department of Homeland Security NSA released the first version of a hash function. Since then, this hash function and its successors have become standard applications on the Internet.
SHA 256 and Bitcoin
The secure hash algorithm fulfills two essential functions for cryptocurrencies. The best-known cryptocurrency that uses this hash function is Bitcoin. First, the Bitcoin feature is used as a proof-of-work algorithm.
Proof-of-work refers to the complicated creation of easily verifiable files added to the blockchain. Those who provide computing power for this proof-of-work will be rewarded with coins in return. This work is commonly referred to as mining.
In addition to the terms described, this hash function plays a role in the creation of Bitcoin addresses; coins can be sent to a Bitcoin address, which consists of 25 to 35 characters.
When sending coins, the exact address must be specified. However, the risk of trying to find a different existing address by typing is extremely low.
Alexander Weipprecht is the managing partner of Provimedia GmbH. As a trained IT specialist for application development, he has been advising leading companies on the following topics for more than 10 years: online marketing, SEO and software. Cryptocurrency is becoming increasingly important to businesses and investors. Through Coin Report and Krypto Magazin Germany, Alexander wants to give all people easy access to the subject matter.