What is Merkle Tree?
A Merkle Tree is an algorithm that allows decentralised nets to enhance their speed and decrease latency. How does that work? Let’s see.
A Merkle tree (hash tree) is an algorithm that allows you to unite many pieces of data under one hash. The method is used to determine the integrity of files and verify information.
Visualized
A hash tree can be thought of as a structure with branches starting from its base and growing all the way up to intermediate nodes. All the branches end with leaves representing data fragments. The root hash (Merkle root) is located at the very base of the tree and acts as a required element of the bitcoin block header. The root hash is the thing responsible for every transaction to be verified. Due to such a structure, only the block header and the operation authentication path need to be downloaded for verification. Thanks to the Merkle tree, the amount of necessary calculations is minimized, which makes it possible to implement Simplified Payment Verification (SPV).
Who has invented Merkle Tree?
The hash tree concept was invented by Professor Ralph Merkle all the way back in 1979. He discovered a completely new way of digital signatures representation and the technology was later patented by Stanford University.
Why Merkels tree useful?
A centralized system uses data from a single source that all the system’s participants rely on. The source itself guarantees correctness of received information.
On the other hand, blockchain is a divided database. All the information, placed inside it is stored on a set of independent nodes. A node cannot accept messages from other participants without inspecting them. Every node needs to determine if the block contains valid transactions.
Merkle trees can be implemented into the blockchain to reduce computational costs. They allow you to make the amount of downloaded data significantly lower and optimize the data verification, using hashing. With the algorithm’s help, a data string is obtained and used to verify a group of transactions. With the help of Merkle trees, information is inspected for errors and synchronized.
Anything else?
If the node has significant computing resources, it can download all the blocks and find the hash of each transaction. After that, Merkle trees are formed. Those allow you to check on data’s integrity operation validity. If a node’s resources are limited and can’t satisfy the computational needs of the operation, it can just request a block header and the transaction IDs.
Where to use Merkel tree?
The method is used in multiple networks. Bitcoin and many other cryptocurrencies are already Merkle Tree based. The algorithm is also widely used in different file systems and databases.
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