On cryptography (II.) Merkle (Angela Merkel) tree __ The Magic of cryptography

Most of the Merkle tree is used for comparison and validation processing, in general, it is a way of hashing large aggregated data "blocks", which relies on dividing the data "blocks" into smaller units
of data blocks. Each small unit block contains only a few data "blocks" and then hashes each small unit block again, repeating the same process until the remaining hash count is only 1 and the
root hash.

Merkle Tree has the following characteristics:
1. It is a kind of tree, can be two fork tree, also can fork tree, whether it is a few fork tree, it has all the characteristics of tree structure;
2. The value of the leaf node of the Merkle tree is set on its own, and the hash value of the Merkle is used as the leaf node;
3 The value of a non-leaf node is based on the values of all the leaf nodes below it, and then calculated according to a certain algorithm. A method for calculating the Merkle node value of a hash tree is to combine all the child nodes of the node, and then hash value of the combined result is computed.

The Bitcoin wallet service uses the Merkle tree mechanism as a "hundred-percent reserve certificate". The main process is to build the Merkle tree, which can be 100% reserves when it is built and the balance of the root node is the same as the published savings address balance. (as pictured)


Reference:
http://blog.bifubao.com/2014/03/16/proof-of-reserves/