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What is SHA-256 Algorithm & Top SHA-256 Coins to mine?

February 29, 2024

Quick Summary

SHA-256 is the most used algorithm which has gained popularity around the world due to the exceptional features that it possesses. It has a distinctive place in the ASIC mining industry due to the compatibility that they both share. This blog attains to provide you with a detailed analysis of the SHA-256 algorithm by unveiling each aspect related to it. You will get to know what SHA-256 is, its advantages, limitations and the applications such as data validation, storing passwords and much more.

Also, you will get to know the top minable coins with SHA-256 as we explore the coin’s current state such as the market cap, total supply, etc. Lastly, you will know how Bitcoin is different from Litecoin which is said to be gold and silver respectively when put into contrast with one another. So let’s get started!

Table of Contents

    Understanding SHA-256

    The National Security Agency (NSA) of the United States created the Secure Hashing Algorithm (SHA) family of cryptographic hash functions. To put it simply, a hash function is a mathematical algorithm that accepts an input (any type of data, such as a file or password) and outputs the hash value, also known as the digest, as a fixed-length string of characters.

    SHA-256 came in replacement for the once-widely used SHA-1 algorithm. There were flaws detected in its code, and was insecure. As the technology developed with time, it became difficult for attackers to take advantage of the SHA-256 algorithm and threaten the integrity of hashed data.

    The hash output’s bit size is denoted by SHA-256. It produces a hash value that is 256 bits long, offering a substantially wider search space than the previous version(SHA-1). This depicts that it is computationally impossible to figure out the original input from the hash rate.

    Step-by-Step Working of SHA-256

    Rounds are a sequence of mathematical operations that SHA-256 uses to process the input data. Preprocessing of the data, message expansion, and message compression function are among the steps that make up each round. The SHA-256 algorithm’s primary steps are as follows:

    • Preparing of Data

    The length of the original message in bits is added after one-bit is added, followed by zeros, to ensure that the input data is expanded to 512 bits.

    • Message Expansion

    By means of a sequence of logical operations, the 512-bit input block is split up into 16 32-bit words. These words are then expanded into 64 32-bit words.

    • Message Compression

    Following the expansion, the 64-word message block is processed in 64 rounds, each of which consists of the following steps:

    • Find the round constant

    Depending on where the round is in the order, a different 32-bit constant value is generated for each round.

    • Determine when to send out messages

    Based on the rounding constant and the 64-word message block, a 64-entry message schedule is produced.

    • Updating Working variables

    In order to update the working variables, which are eight 32-bit words that are used to store intermediate values during the hashing process, a set of logical computations and the message schedule are used.

    • Do the hash value calculation

    The 256-bit hash value is generated by combining the final outcomes of the working values after all 64 cycles have been finished.

    What are the Features of SHA-256?

    The message length, digest length, and irreversibility are the three main characteristics of the SHA-256 algorithm.

    • Digest Length

    A cryptographic hash function applied to data produce a hash digest with a length of 256 bits. You can choose to use larger digests and SHA-512 when installing an SSL certificate on your server. SHA-512 is more secure, but because it requires more computations and processing power, it is not advised for most systems.

    • Cryptographic Hash Function

    The hash function SHA-256 generates a fixed-size output (hash value) from an input (message). Because each unique input produces a unique output that seems random, it is very difficult to deduce the original text from the hash value.

    • Fixed Output Length

    A hash value of 256 bits (32 bytes) is produced by SHA-256. The reliable and uniform results facilitate effective data contrast and integrity confirmation.

    • Resistant to Collision

    Unable to produce the same hash output from two input values makes it collision resistant. This guarantees that a distinct hash value is assigned to each block in the blockchain ledger.

    • Preimage resistance

    A hash value prevents the input from being recreated. This guarantees that, in the bitcoin proof of work, miners are forced to use the brute force method to ensure that the work is completed, rather than attempting to guess the value of the nonce by converting the acceptable hash back into the input.

    Dominance of ASICs on SHA-256

    It’s important to remember that the SHA-256 hashing algorithm was never intended to withstand powerful computers. The debate over ASIC resistance on blockchain networks started long after the release of Bitcoin.

    In 2009, the Bitcoin network first appeared, supporting only CPUs. As a result, everyone who mines networks has an equitable arrangement. The network was impacted by the introduction of GPUs, FPGAs, and ASICs.

    Consequently, cheaper options such as CPUs and GPUs have lost some of their usefulness in the long run for bitcoin mining.

    It is evident that ASICs now rule the network and are becoming more and more potent. The overall hash rate of the Bitcoin network over time makes this evident.

    What are the applications of SHA-256?

    Here are a few applications of the SHA-256 algorithm:

    • Data validation

    When there is a need to confirm the accuracy of data, particularly while it is being transmitted, using SHA-256 becomes essential. A reliable technique for data verification is offered by a change in the hash value, which indicates a modification in the original data.

    • Storing passwords

    SHA-256 is widely used for password storage that is secure. Sensitive data is kept more securely because the hash value is saved rather than the actual password.

    • Electronic signatures

    In order to guarantee the legitimacy of electronic documents, SHA-256 turns into a useful instrument. It helps with the creation of digital signatures, which validates the authenticity of the document, by generating a distinct hash value for every document.

    • Blockchain-based technology

    SHA-256 is essential to the operation of blockchain technology, especially in cryptocurrencies like Bitcoin. By resolving challenging mathematical puzzles, it aids in the mining process by adding fresh transactions to the blockchain.

    Advantages of SHA-256

    • Data integrity

    SHA-256 makes sure that throughout transmission, the data stays unaltered and maintained. Any modification, no matter how small, to the original data results in an entirely different hash value.

    • Security

    SHA-256 offers a high level of protection for an encrypted hash function. Calculating the original data using its hash value is almost zero.

    • Efficiency

    The computational efficiency of SHA-256 is maintained despite its complex structure. It produces the hash value instantly, enabling quicker data processing.

    Drawbacks of SHA-256

    • Lack of flexibility

    Data cannot be undone or decoded back into its original form once it has been converted into a hash value.

    • Potential vulnerability

    A hash collision, which occurs when two distinct data inputs produce the same hash value, is an extremely uncommon but theoretical possibility.

    Top SHA-256 coins to Mine

    top sha-256 coins to mine

    Despite the coins that use SHA-256, Bitcoin is the most prominent one. When understanding how Bitcoin differs, it is vital to consider an altcoin that is slightly lighter than Bitcoin for understanding its distinctive features better. Although the algorithm differs but the working of Litecoin is somewhat the same, it differs just a little when put in contrast to one another. Let’s see how BTC differs from LTC for a thorough understanding:

    How is BTC different from Litecoin

    Almost after a week of Bitcoin, Litecoin was also introduced, which is known to be the earliest form of altcoin to emerge soon after Bitcoin. As Litecoin is the lighter version of Bitcoin, Litecoin’s founder Charlie Lee widely referred to it as “The silver to Bitcoin’s gold”.

    The maximum supply cap of each cryptocurrency is where Litecoin and Bitcoin diverge first. The maximum quantity for Bitcoin is 21 million, whereas the maximum quantity for Litecoin is 84 million.

    The mining protocols for Litecoin and Bitcoin are another difference. As was previously mentioned, Litecoin generates coins using a modified version of Scrypt, while Bitcoin uses SHA-256. The length of time it takes to process transactions for each coin varies depending on the protocol. When it comes to transaction processing and confirmation speed, Litecoin outperforms Bitcoin four times.

    As less rounds of transaction verification are required, processing transactions quickly may come at the expense of security. Litecoin’s confirmation time is 2.5-minute whereas Bitcoin has approximately 10-minute confirmation time.

    how is bitcoin different from litecoin

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    Conclusion

    An essential component of the Bitcoin protocol is the SHA-256 hashing algorithm. Several aspects of the technology, including hash functions, Bitcoin addresses, and mining, have seen its implementation. The foundation of contemporary technology, SHA-256 offers trust as well as safety in an interlinked digital world. It was developed out of the necessity for secure data integrity.

    FAQs on SHA-256 Algorithm

    • What is the length of SHA-256?

      The SHA-256 algorithm has a length of 256 bits.

    • Can SHA-256 be reversed?

      No SHA-256 is irreversible as it utilizes a one-way function to generate the hash-value.

    • Which consensus method does the SHA-256 use?

      SHA-256 uses the proof-of-work consensus method.

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