In cryptography, Scrypt is the name of password-based key functions made for Tarsnap online by Colin Percival. The algorithm was made to deter large-scale hardware attacks by making them prohibitively expensive. A massive amount of memory would be required to launch such an attack. It’s known as a hard-key derivative function and such a memory-hard function requires a lot of RAM to be resolved.
Scrypt creates lots of pseudorandom numbers to be stored in RAM locations. The algorithm accesses these numbers before they give results. It can be an intensive process to create these numbers because they need to be accessed many times. Consequently, RAM needs to be used together with hashing power rather than creating them on-the-fly.
Scrypt also reduces the advantages of using ASIC miners in the network. The benefit of this is that it gives ordinary miners more of a chance to participate in the network. It also reduces energy usage. The demands of the network are quite low so Scrypt could arguably be described as an eco-friendly approach.