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The first character after the user name in /etc/shaddow, is the type of encryption used.

http://www.lamolabs.org/blog/10670/how-is-my-password-stored-in-linux/

So:

$5$ means SHA256
$6$ means SHA512

Looking at my cent 5.9 vm I downloaded from puppet's website, I notice that the encryption level is $1$.

What level of encryption is 1 ?

[root@learn etc]# cat /etc/shadow| grep root | cut -c1-8
root:$1$

Resources
http://linux.die.net/man/3/crypt

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up vote 0 down vote accepted

From the crypt(3) man page:

          ID  | Method
          ─────────────────────────────────────────────────────────
          1   | MD5
          2a  | Blowfish (not in mainline glibc; added in some
              | Linux distributions)
          5   | SHA-256 (since glibc 2.7)
          6   | SHA-512 (since glibc 2.7)
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