Merkle trees are a core part of blockchain technology. A merkle tree is a structure which permits efficient and secure verification of content in a large set of data. This structure verifies the consistency and content of the data. Merkle trees are used by both Bitcoin and Ethereum.
A Merkle tree produces a digital fingerprint of the entire set of transactions. This enables a user to verify whether or not a transaction is included in a block.
Merkle trees are created by repeatedly hashing pairs of nodes until there is only one hash left (this hash is called the Root Hash, or the Merkle Root). They are constructed from the bottom up, from hashes of individual transactions (known as Transaction IDs).
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