Conducting bitcoin transactions is becoming a common practice in the modern financial system. Nevertheless, novice cryptocurrency investors have a lot of questions about buying, selling digital money, and other operations. This article will focus on verifying a bitcoin transaction.
What is a bitcoin transaction
A Bitcoin transaction is a confirmed section of data that is written to the network without encryption. Each user can trace the chain of operations, starting with the receipt of the first crypto coins.
Transactions are carried out between special wallets. Investor users buy, invest in crypto-coins and hold them, counting on the growth of their rate in order to profitably sell in a year or several years.
But in this case, the meaning of digital money as such is lost. It is necessary to use bitcoins, that is, to spend in online stores on the stock exchange. In this case, it becomes necessary to conduct and verify the transaction.
How to find a bitcoin transaction on the blockchain
Bitcoin transactions are different from regular bank account transactions. And the crypto coins themselves do not exist in the form in which we are used to seeing dollars, pounds and other currencies on accounts.
Digital money is not stored on a bitcoin address either. The wallet contains only records of signed transactions between wallets or accounts.
The balance of such records may change depending on the operation performed. Records are stored in the Blockchain (a chain of blocks that looks like a ledger).
To view bitcoin transactions, you can install a special program, such as Block Explorer. The application makes it easy to track every bitcoin transaction, the program independently creates tables and graphs that show the activity in the crypto wallet.
Information about receiving crypto coins from another wallet includes the following types of data:
- Input (input), that is, information about the bitcoin address of the sender.
- Amount (amount) – this is the number of coins that have been credited to the wallet account.
- Output (output), that is, information about the recipient of the transfer.
How bitcoin transactions work
When conducting a bitcoin transaction, the user must realize that nothing is actually being sent, but simply the entered number of coins is being copied from one wallet to another, and the information is available to everyone, as it is written to an unencrypted ledger.
Each transaction is recorded as an input, that is, the amount transferred to the account or output for the amounts sent.
The withdrawn amounts become unavailable and further operations are impossible. However, here you can track the total number of received bitcoins on a specific wallet.
When carrying out transactions, the names of the wallet owners are not displayed, only the name of the wallet is visible, with the inclusion of a digital and alphabetic code.
Thanks to this, the service can be considered anonymous. Linking a wallet to documents of a real person is impossible.
With all the openness of the information that is stored on the blockchain, it is impossible to conduct operations knowing only a combination of letters and numbers. It is also necessary to use a secret code, also consisting of numbers and letters.
How long to wait for a transaction
There are times when the confirmation of a transaction is delayed. This happens because miners, who are also engaged in the search and extraction of cryptocurrencies, are engaged in this.
Waiting for the end of mining sometimes takes quite a long time from 10 minutes to several hours. When conducting transactions through specialized processing companies, you do not need to wait. Bitcoin address is rewritten instantly.
BitPay or Coinbase companies are equipped with instant confirmation of transactions. However, you should take into account the increased commission for the transfer of crypto coins.
In general, the timing depends on several points:
- The number of transactions in progress at a given point in time. Over the past year, transactions with bitcoins have grown 8 times. Sometimes the number of transactions grows to critical values, waiting for payment confirmation reaches one hour.
- Transactions with a small fee are usually delayed, transfers with a high fee are given priority.
- The transaction verification time also depends on the current cryptocurrency exchange rate.
How to find out how many confirmations have passed?
You can also use the blockchain.info website to view signed transactions. On the service for a quick search, you must use the search bar located at the top of the page. This function allows you to find out details about a specific bitcoin address, number in the block chain, transaction hash.
How to increase transaction speed?
There are several ways to reduce transaction time:
- Increase in the volume of transferred funds. The more cryptocurrencies are transferred, the higher the status of the transfer.
- Increasing transaction fees. If users pay more than 0.00002 BTC for transactions, miners confirm payments faster.
- The use of special services like Coinbase allows you to conduct transactions instantly. On the sites, the keys of the seller and the buyer are stored, confirmation occurs directly through the service.
- It is also possible to use crypto wallets with multi-signature functionality. To make payments on such services, you only need to enter a secret key. The wallet uses its own key. Saving time and money on the face.
Why can the input and output amounts be different?
Because bitcoins do not exist on electronic wallets, like other currencies on bank accounts. All bitcoins are recorded in transactions, so when transferring to another person, you need to take into account the fact that the amount from the transaction cannot be divided.
The user is forced to transfer the entire amount, but indicate the real amount of the operation. One amount will go to the output, and another amount will go to the input, the difference will be transferred to the client as change.