Mining Algorithm

Bitcoin's mining algorithm is SHA-256d - the double application of SHA-256 (SHA-256(SHA-256(header))). Miners compute this hash on candidate block headers until the result falls below the current difficulty target.

The double-hash design isn't arbitrary. It defends against length-extension attacks, a known weakness of single-pass SHA-256 where an attacker who knows SHA-256(x) can compute SHA-256(x || y) for some y without knowing x. Double hashing breaks this property. The cost is a 2× computational hit on the hashing operation; the security benefit was judged worth it.

Other cryptocurrencies use different algorithms - Scrypt (Litecoin), Ethash (legacy Ethereum), RandomX (Monero), Equihash (Zcash), and many others. Each design choice reflects priorities: ASIC-resistance, memory-hardness, energy efficiency, or just protocol differentiation.

For Bitcoin, SHA-256d is locked in by:

• Massive hardware sunk cost. The global Bitcoin mining industry has spent billions on SHA-256-specific ASICs. Changing the algorithm would brick all that hardware.
• A required hard fork. Any algorithm change is a hard fork, which Bitcoin's consensus mechanism makes nearly impossible to deploy.
• No real demand to change. SHA-256 hasn't broken in 25+ years of cryptanalysis. The security argument for switching doesn't hold.

The algorithm choice is one of the most permanent parts of Bitcoin's design. Even discussions about "post-quantum migration" focus on signature schemes (ECDSA → quantum-resistant signatures), not the hashing algorithm. SHA-256 is here for the duration. See Proof-of-Work for the broader mechanism this algorithm is the engine of.