Hashing does read every byte of every file that you are sharing.

The idea of hashing is to identify whether two files are identical or not.

The hard way of testing two files to see if they are identical is to compare each byte of each file. This is impractical if one of the files is sitting on a remote machine.

Hashing reads each byte of a file and creates a number based on those bytes. Two identical files will generate the same number (hash). Two different files (even if they are only a little different) will (probably) generate different numbers.

Now, a comparison between two files can be made by comparing the numbers rather than the whole file.

Mark