Merkle Tree : The secret sauce for efficient verification in blockchain

Let’s learn with example! Imagine a giant filing cabinet overflowing with documents (data) in a blockchain network. Each document represents a transaction. How can you efficiently verify if a specific document
(transaction) is actually in the cabinet (blockchain) without sifting through everything?

Here’s where Merkle trees come in! They act like a super organized filing system for blockchain data.

• A Merkle tree is a special kind of tree structure used in blockchain.
• At the bottom (leaves) of the tree, each document (transaction) is summarized into a unique fingerprint called a “hash.” Think of a
  hash like a short, unique code for each document.
• As you move up the tree, these “hashes” are paired together and hashed again to create a new, higher-level hash. This process continues until
  you reach the very top, where there’s a single hash called the “Merkle Root.”

A binary tree is a fundamental data
structure used
in computer science.

Benefits:

• Efficiency: You don’t need to check every single document (transaction) to verify if a specific one exists. You only need to compare the hash of the document you’re interested in with the relevant higher-level hashes in the tree, leading you straight to it.
• Integrity: If even a single letter changes in a document, its hash will completely change. This makes it easy to detect any tampering with the data.
• Scalability: As blockchains grow and store more transactions, Merkle trees become even more valuable. They enable efficient verification regardless of the blockchain’s size, making them essential for scalable blockchain applications.

Detailed Explanation:

• Hashing: Imagine a machine that takes any document (data) and scrambles it into a unique fixed-size code (hash). This code acts like a fingerprint for the document. Even a minor change in the document will result in a completely different hash.
• Building the Tree: Each document’s hash becomes a leaf node at the bottom of the Merkle tree.
  Pairing and Hashing: Next, neighboring leaf nodes (hashes) are paired up. These pairs are then hashed again, creating a new hash for that level.
• Climbing the Tree: This pairing and hashing process continues as you move up the tree, with each level containing the hash of the previous level’s pairings.
• Merkle Root: At the very top, you reach the single hash representing the entire tree — the Merkle Root.

Verifying Information:

To verify if a specific document (transaction) exists in the blockchain, you only need its hash.

You can compare this hash with the relevant higher-level hashes in the Merkle tree, following a path to its specific location in the tree.
If all the hashes match along the way, you can be confident that the document (transaction) is indeed part of the blockchain.

Think of it like this:

Imagine you want to verify if a specific page (transaction) is in a giant textbook (blockchain).
You don’t need to read the entire book. The Merkle tree acts like a detailed table of contents with unique codes (hashes) for each chapter (section) and sub-section. By following the codes, you can quickly locate the specific page you’re interested in.

Thus, Merkle trees are a fundamental building block in blockchain technology, ensuring efficient verification and data integrity in a decentralized network.