What is a Merkle Tree?
A Merkle tree, also known as a binary hash tree, is a data structure used for efficiently storing and verifying large sets of data. It was invented by Ralph Merkle in 1979 and named after him. In the context of cryptocurrencies, it is used to verify the correctness and integrity of transactions stored on the blockchain.
How Does A Merkle Tree Work?
Merkle trees are constructed using hashes—a unique digital fingerprint that represents any length of data or information —to represent each set of transaction records within a block. Starting from the bottom layer (the leaves), each node stores cryptographic hashes that represent its child nodes until eventually reaching an aggregate root hash at the top (the root). This allows users to quickly verify whether their transaction has been included in the blockchain without having to download every single transaction record contained within it.
Why Is A Merkle Tree Used In Cryptocurrencies?
The main purpose for using a Merkle tree in cryptocurrency networks is efficiency; with this structure, only two hashes need to be compared instead of large amounts of data when verifying transactions. Additionally, since all transactions are cryptographically linked together through multiple layers they cannot be changed without invalidating all subsequent blocks which makes them secure even if some nodes become compromised or malfunctioning. Finally, because they use hashing algorithms such as SHA-256 (Secure Hash Algorithm 256 bit) which produces an irreversible output that can’t be reversed back into its original form without huge computational power, criminals would not be able to alter their own records once published on the blockchain ledger unless they possess more than 50% computing power over entire network – making it almost impossible task due achieve successfully .
