Is hashing a password twice before storage any more or less secure than just hashing it once?
What I\'m talking about is doing this:
$hashed_password
The concern about reducing the search space is mathematically correct, although the search space remains large enough that for all practical purposes (assuming you use salts), at 2^128. However, since we are talking about passwords, the number of possible 16-character strings (alphanumeric, caps matter, a few symbols thrown in) is roughly 2^98, according to my back-of-the-envelope calculations. So the perceived decrease in the search space is not really relevant.
Aside from that, there really is no difference, cryptographically speaking.
Although there is a crypto primitive called a "hash chain" -- a technique that allows you to do some cool tricks, like disclosing a signature key after it's been used, without sacrificing the integrity of the system -- given minimal time synchronization, this allows you to cleanly sidestep the problem of initial key distribution. Basically, you precompute a large set of hashes of hashes - h(h(h(h....(h(k))...))) , use the nth value to sign, after a set interval, you send out the key, and sign it using key (n-1). The recepients can now verify that you sent all the previous messages, and no one can fake your signature since the time period for which it is valid has passed.
Re-hashing hundreds of thousands of times like Bill suggests is just a waste of your cpu.. use a longer key if you are concerned about people breaking 128 bits.