What Is the Risk of a Hash Collision in a Signed Contract?

The risk of a hash collision ▴ where two different contracts produce the exact same hash ▴ is theoretically possible but practically zero with modern, robust hashing algorithms like SHA-256 or Keccak-256. If a collision were to occur, a malicious actor could trick a user into signing a benign contract, and then replace the data with a malicious contract that has the same signature.

The extremely low probability is why these functions are considered collision-resistant and suitable for financial contracts.