What Is the Advantage of Using a Hash Commitment over Full Contract Disclosure? ⎊ Path

What Is the Advantage of Using a Hash Commitment over Full Contract Disclosure?

The main advantage is privacy combined with cryptographic proof. A hash commitment allows parties to prove that a specific contract or data existed at a certain time without revealing the sensitive terms to the public blockchain.

It provides a non-repudiable time-stamp and proof of integrity. If a dispute arises later, the full contract can be revealed, re-hashed, and compared to the on-chain commitment to verify its authenticity.

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Glossar

Commitment

Allocation ⎊ Commitment within cryptocurrency, options, and derivatives contexts frequently manifests as capital allocation strategies, dictating the proportion of a portfolio dedicated to specific assets or derivative positions.

Hash Commitment

Commitment ⎊ A hash commitment is a cryptographic primitive where a party publishes the output of a one-way hash function applied to a secret value, effectively committing to that value without revealing its content.