Hash functions are algorithms that transform input data into a fixed-size string of characters, which is typically a sequence of numbers and letters. This output, known as a hash value, is unique to the input data, making hash functions essential for ensuring data integrity and security in various applications, such as blockchain and password storage. These functions are designed to be fast and efficient, allowing for quick data verification. They play a crucial role in digital signatures and message authentication codes, ensuring that any alteration to the original data can be easily detected by comparing hash values.