On the Similarities between Blockchains and Merkle-Damgård Hash Functions

Abstract

Blockchain as a new technology has created a great amount of hype and hope for different applications. There is a promise of a better, decentralised trust based on strict guarantees from cryptography. However, there is a great similarity in the structure of blockchains and classical iterated hash functions of the Merkle-Damgård (M-D) type. As the structure of M-D type hash functions has been extensively studied and many different structural weaknesses have been exposed, it is plausible to think that blockchains also share these structural problems. In this paper, we present the most relevant problems of M-D type hash functions and their relation to blockchains. We also examine how these might affect currently established blockchains. Our results can help in avoiding some problems in the design of new blockchain systems and also provide some (theoretical) limits on the trustworthiness of current blockchains.