Linux-based systems handle everything in the form of files. Passwords are stored in encrypted form in the /etc/shadow file. These passwords are commonly stored as hashes rather than plaintext.
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An example of
shadow:user:$y$j9T$QxFw8T.D1bD2w6...SNIP...f8Ms:18955:0:99999:7::: -
Breakdown:
Hashes Used
In password hashes like $y$j9T$QxFw8T.D1bD2w6...SNIP...f8Ms:, the $y$ part is called the ID.
This (ID) indicates which cryptographic hash method was used to encrypt the password.
Common cryptographic hash methods include: