Blowfish encryption utilizes XOR operation in its Feistel network structure. During the 16-round process, each half of the plaintext block is subjected to a function F and then XORed with the other half. Specifically, the left half (L) is XORed with the result of applying F on the right half (R). This new L becomes R for the next round while the old R becomes the new L. The swapping ensures that an attack on one part affects both halves.
In decryption, Blowfish uses XOR again but in reverse order. It starts by XORing the ciphertext’s right half with the output of F applied on the left half. Then it swaps them as done during encryption. Repeating this for 16 rounds decrypts the data. Thus, XOR plays a crucial role in both encrypting and decrypting processes in Blowfish cipher.
