SHA-256 (Secure Hash Algorithm 256-bit) is a cryptographic hash function from the SHA-2 family that transforms input data of arbitrary size into a string of fixed length of 256 bits. The resulting value is called a hash, or a digital fingerprint: even a minimal change in the source data completely changes the result. At the same time, reverse recovery of the original information from the hash is practically impossible, which is what makes the function a cornerstone of modern cryptography.

In the blockchain, SHA-256 performs several key tasks. It underlies the Bitcoin protocol and is used in generating addresses, linking blocks into a chain, and in the Proof-of-Work mechanism. Miners search for a value such that the hash of the block header satisfies the given difficulty conditions — it is precisely this process that protects the network against forgery.

Key properties of SHA-256

• Determinism: the same input always produces the same hash;
• Avalanche effect: the slightest change in data changes the result entirely;
• Collision resistance: it is extremely hard to find two different inputs with the same hash;
• Irreversibility: it is unrealistic to recover the source data from the hash.

In addition to Bitcoin, the SHA-256 algorithm is also used in a number of other cryptocurrencies, as well as widely employed in digital signatures and data integrity verification.