What is a Merkle Tree?
- Merkle Tree is the fundamental element of Blockchain technology. They are the mathematical algorithm composed of hashes from different blocks and facilitate the summary for all blockchain transactions.
- In the crypto ecosystem, Merkle Tree is fondly known as Hash Tree where each leaf node is coded with the hash of data block. Within the blocks there exist child nodes which are non-leaf ones and are labeled with cryptographic hash accordingly. The leaf node is the lowest node in the tree is basically the element of the binary hash tree which requires proportional hash computing based on the crypto algorithm. These are basically a generalization of hash lists and hash chains that ensure data efficiency in large data structures.
- The Concept of Hash Tree was patented by Ralph Merkle in the year 1979. Thus, got the name “Merkle Tree.”
What is Merkle Root in Blockchain?
- These are the hash of all the hashes which are then included in the blockchain network and are also known by the name hash root. It provides a single hash value that enables validation of all transactions in the block; it comes up as a concluding value to the Merkle Tree.
- It is a mathematical way of verifying data in the Merkle Tree. These are fundamental for maintaining and computing cryptocurrencies such as Bitcoin, Ether and etc.
- The mining of hash in the transaction in the Merkle tree results in the Merkle Root value. Due to its tree-like hash structure, all the information about each transaction exists in the block and is stored in the block header.
How do the Merkle tree and rootwork?
- All the transactions in the block are stored by producing a digital fingerprint for the complete transaction set. It helps in providing the verification of whether or not the transaction is valid to be included in the block.
- The concept is constructed considering the bottom-up approach. Merkle Trees are based on the repetitive calculation of hash pair until there remains only one hash which is known as Merkle Root (Root Hash).
- The leaf nodes are ideally the hash of transactional data whereas the non-leaf nodes are meant for the hashes of previous transactions. Being the binary tree, the Hash Tree is mandated to have an even number of leaf nodes. If in case an odd number of transactions get generated in the process, the hash will be duplicated to ensure an even number of leaf nodes.
- Any changes in the transactional details or orders get reflected in the hash. Such changes would shade its shadow from Merkle Tree to Merkle Root which eventually will alter the value of the root resulting in invalidation of the block.
- The blocks in the Merkle Tree which are hashed in the mining process consist of the last block’s hash, a Nonce & Merkle Root block. Thus, the inclusion of the Root Hash in the process at block header tampers proof the transaction and provides certain benefits to Merkle Tree.
How and where is Merkle used?
- The usage of the hash tree for hash-based cryptography makes it compatible with IPFS, Btrfs, and ZFS file systems to curb the issue of data degradation.
- In recent times protocols and distributed revision systems like Dat, Apache Wave, Git and Mercurial have adopted a hash tree in their computing systems.
- Similarly, Tahoe-LAFS, Zeronet, Bitcoin, Ethereum, and other peer-to-peer networks have put the concept of a hash tree in the application.
- Several NoSQL systems like Apache Cassandra, Riak, and Dynamo have widely ensured the execution of hash tree algorithms in their operations.
- In fact, the initial implementation of Bitcoin resulted in compression of hash function up to a great extend which was then mitigated by the Fast Merkle Trees.
Why Merkle Process?
- The Merkle trees are put to use for verifying any type of stored data and helps in handling and transferring them between computers.
- The proper validation of data can be done to ensure that data received by peer networks are undamaged, unaltered, and true.
- These provide the means to ensure data integrity with its consistent validation process.
- The Merkle Tree consumes less memory, disk space than the proofs which ease the computation process and makes it quick.
- The least amount of information is required by Merkle proofs to transmit information in the peer-to-peer network.
- It facilitates the users with Simplified Payment Verification which is a way for verifying transactions without downloading the entire block. This is generally used by lightweight Bitcoin clients.
What are the limitations of the process?
- The verification in the Merkle Process is done only after the completion of the entire data transaction which makes the approach less efficient.
- In case of failure of transactions, there is no suitable way yet to find out the culprit for sending the inappropriate chunks to the data list.
- The updating of even single inappropriate file results in regeneration of complete hash to the trusted servers which increases the overhead cost involved in syncing.
- There prevails excessive trust on the server which may at times result in fraud and ill acts by the peers who are not known to each other.
The introduction of Merkle Tree came up as an alternative to ensure better computing power and storage. The concept is ideally meant for blockchains allowing them to function effectively and efficiently to maintain transactional integrity.
It paves the way for development in the crypto ecosystem and enhances its dominance in the money market. Merkle trees are structured to serve the need for growing technological attributes yet it needs to figure out the ways to curb their associated limitation to grow limitless.