DA-05 · LESSON 06

Preimages and Hash160

KEY DEFINITIONS

Terms used in this lesson

Preimage: The original secret data whose hash equals a previously committed value.
Hash160: SHA-256 followed by RIPEMD-160, producing the 20-byte hash used by several Bitcoin spending conditions.
Vault: A set of Bitcoin outputs and spending rules that holds collateral and represents the current loan state.
HMAC: Hash-based message authentication code: a keyed hash construction used to authenticate data or derive deterministic secret material.
HMAC-SHA256: HMAC using SHA-256 as its underlying hash function.
SHA-256: A cryptographic hash function used throughout Bitcoin to produce fixed-size 256-bit digests.
Oracle: A system that reports outside information, such as a market price, for use by a protocol.
Hashlock: A spending condition that requires revealing data matching a committed hash.
UTF-8: A standard variable-length byte encoding for Unicode text.
RIPEMD-160: A 160-bit cryptographic hash function used in Bitcoin’s HASH160 construction.

A breached threshold reveals secret material whose Hash160 matches the value committed into the vault's liquidation Script leaf.

45 min Difficulty 5/5 Not started

VISUAL MODEL

See the whole mechanism before going step by step

Use the diagrams to orient yourself. Then the guided explanation below teaches every part in depth.

4 explanatory views

CONCEPT-SPECIFIC MAP · ducat vaultA Ducat action moves one Bitcoin-anchored vault state to a successorSelect any state to inspect its exact role.

RELATIONSHIP MAPInputs, rule, and outputs

01
PREDECESSORCurrent vault outpoint
The current Bitcoin output anchors collateral and identifies the state being spent.
02
REQUESTPreimages and Hash160
The Preimages and Hash160 workflow proposes one exact action and successor state.
03
POLICYProfile, oracle, signatures
Applicable policy, price evidence, authorization, and transaction shape are checked.
04
BITCOIN SPENDScript-valid transaction
Bitcoin miners and nodes can include only a transaction that satisfies Bitcoin rules.
05
SUCCESSORNew outpoint and state
Ducat validators reconstruct debt, collateral, token, and account changes from the confirmed transaction.

Rule shown: Bitcoin checks the spend; Ducat components independently reconstruct and validate the additional protocol state.

STAGE 1 OF 5PREDECESSOR: Current vault outpoint

The current Bitcoin output anchors collateral and identifies the state being spent.

Governing relationship: Bitcoin checks the spend; Ducat components independently reconstruct and validate the additional protocol state. Complete path: 1. PREDECESSOR, Current vault outpoint. The current Bitcoin output anchors collateral and identifies the state being spent. 2. REQUEST, Preimages and Hash160. The Preimages and Hash160 workflow proposes one exact action and successor state. 3. POLICY, Profile, oracle, signatures. Applicable policy, price evidence, authorization, and transaction shape are checked. 4. BITCOIN SPEND, Script-valid transaction. Bitcoin miners and nodes can include only a transaction that satisfies Bitcoin rules. 5. SUCCESSOR, New outpoint and state. Ducat validators reconstruct debt, collateral, token, and account changes from the confirmed transaction.

1. State transitionWhat exists, what changes, and what results

BEFORE

Use the aligned commitment 921165d9559cdf66632513c565ae6ee0b4b8f2822a094378ddb01edddae6fb9a and the public 32-byte demonstration secret 746573742d6f6e6c792d6f7261636c652d7365…

MECHANISM

The oracle computes HMAC-SHA256 using its private key material and the commitment hash.

AFTER

HMAC-SHA256 produces threshold key 6923522c91ac8593739d607fac598515af9490a5d0fcf3b9ab4c480793ae5a10. Its Hash160 is 36b8d5bfea7bb90faf2a33382941ff4c7f41d56d. Revealing the ke…

Text equivalent: Starting from Use the aligned commitment 921165d9559cdf66632513c565ae6ee0b4b8f2822a094378ddb01edddae6fb9a and the public 32-byte demonstration secret 746573742d6f6e6c792d6f7261636c652d7365637265742d6e6f742d612d6b65. The secret decode… The mechanism begins when The oracle computes HMAC-SHA256 using its private key material and the commitment hash. The resulting lesson is HMAC-SHA256 produces threshold key 6923522c91ac8593739d607fac598515af9490a5d0fcf3b9ab4c480793ae5a10. Its Hash160 is 36b8d5bfea7bb90faf2a33382941ff4c7f41d56d. Revealing the key proves hash knowledge, not market truth.

2. Mechanism pathSelect a stage to inspect its job

STAGE 1 OF 4

Derive the hidden key

The oracle computes HMAC-SHA256 using its private key material and the commitment hash.

Complete path: 1. Derive the hidden key: The oracle computes HMAC-SHA256 using its private key material and the commitment hash. 2. Publish only the hash: Hash160 of the threshold key becomes the public hashlock value while the key remains absent from the sealed contract. 3. Evaluate a requested threshold: The evaluation flow checks a requested contract against a later authenticated price and identifies a breach when current price is below threshold price. 4. Reveal and verify: The breach event includes the threshold key; any client hashes it and compares the result with the prior commitment.

3. Rule and failure boundaryWhat accepts the result and where it can stop

ACCEPTED PATH

The worked case executes the named inputs and checks in the displayed order. The breach event includes the threshold key; any client hashes it and compares the result with the prior commitment.

CHANGED CONDITION

A missing, malformed, stale, unauthorized, or inconsistent required input stops at its first named boundary. The captured evaluator processes requested threshold hashes and reveals those requests found below their own thresholds; it does not automatically sca…

Important distinction: The oracle publishes every ladder preimage when any price threshold is crossed. The captured evaluator processes requested threshold hashes and reveals those requests found below their own thresholds; it does not automatically scan every vault selection.

Text equivalent: The accepted path is enforced by The worked case executes the named inputs and checks in the displayed order. The breach event includes the threshold key; any client hashes it and compares the result with the prior commitment. If the required condition changes, A missing, malformed, stale, unauthorized, or inconsistent required input stops at its first named boundary. The captured evaluator processes requested threshold hashes and reveals those requests found below their own thresholds; it does not automatically scan every vault selection.

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Learn the idea

A preimage is secret data whose hash matches a committed value. Ducat derives a threshold key with HMAC-SHA256 from the oracle secret and commitment hash, then stores only Hash160 of that key in the price contract until breach.

GUIDED EXPLANATION1/4 ideas inspected

Derive the hidden key

The oracle computes HMAC-SHA256 using its private key material and the commitment hash.

The worked example follows the explanation

Inspect every idea above to open it.

Important distinction“The oracle publishes every ladder preimage when any price threshold is crossed.”

The captured evaluator processes requested threshold hashes and reveals those requests found below their own thresholds; it does not automatically scan every vault selection.

FINISH LEARNING FIRST

The questions unlock after every required learning activity

Inspect every guided idea, open the worked example, rebuild its mechanism, and complete the deterministic lesson tool. Your progress is saved automatically.