How do Bitcoin Transactions Work

bitcoin wallet transaction fee

Bitcoin-payments are sent using electronic bitcoin wallet transaction fee, and they have their own unique digital signature for providing enhanced security measures. Everyone in the network knows about the transaction, and the transaction history can be traced back to the time when bitcoins were released.

It’s very profitable to keep bitcoin on your electronic wallet, if you are a speculator who expects a price increase in order to sell as much as possible, but the whole point of this currency is to spend it, right? So, when working with bitcoins, how do transactions work?

No Bitcoin, only bitcoin-transaction records

The most interesting thing about bitcoin: they do not exist anywhere, not even on the hard drive. We’re talking about someone who has bitcoin, but when you look at a particular bitcoin address, it does not have digital bitcoin as an analogue of a currency or a payment document, just like you could hold pounds or dollars in a bank account. You can not point to a physical object or even a digital file and say “it’s bitcoin.”

Instead, there are only transaction records between different addresses, with balances that increase and decrease in the event of replenishment of the electronic wallet or write-off. Each transaction that has ever occurred is stored in an extensive public book, called a block chain. If you want to find the balance of any bitcoin address, the information will not be stored at this address; You must restore it by looking at the block chain.

What does the transaction look like?

If Bill sends Michael bitcoat, this transaction will contain three pieces of information:

  • Input. This is a record of what bitcoin-address was used to send. bitcoin Bill first (she got them from her friend, Robert).
  • Quantity. This is the number of bitcoins Bill sends Michael.
  • Exit. This is the bitcoin-address of Michael

How does he go?

How transaction bits work. To send bitcoins, you need two things: bit-address and private key. Bitcoin-address is generated randomly and is simply a sequence of letters and numbers in random order. A private protected key is another sequence of letters and numbers, but unlike your bitcoin address, this is kept secret.

Try to think about your bitcoin address as a safe with a glass facade. Everyone knows what’s in it, but only a private key can unlock it to take things or put things.

When Bill wants to send the bitcoins to Michael, he uses his secret key to sign the message with the source code (the original coin transaction), the number and the output (Michael’s address).

Then he sends them from his electronic bitcoin purse to a wider network of bitcoins. From there, bitcoins miners check the transaction, placing it in the transaction block and ultimately solving it.

Why should I sometimes wait until my transactions are cleared?

Because your transaction needs to be checked by miners, you sometimes have to wait until they finish mining. The bitbox protocol is set so that each block takes about 10 minutes.

Some service merchants can make you wait a while until this block is confirmed, which means that you may need to drink a cup of coffee and return in a short time before you can download digital goods or use paid services.

On the other hand, some traders will not make you wait until the transaction is confirmed. They effectively take a chance on you, assuming that you will not try to hold the same bitons somewhere before the transaction is confirmed. This often happens for low-cost transactions, where the risk of fraud is not that great.

What should I do if the amounts of input and output do not match?

Because bitcoins exist only as transaction records, you may encounter many different transactions that are tied to a specific address. Perhaps Jane sent Alice two bitters, Philip sent her three bitcoins, and Eve sent her one bitcoin, all as separate transactions at different times.

They will not be automatically merged into Alice’s wallet to make one file containing six bit-caps. They just sit there as different transaction records.

When Alice wants to send bitcoins to Bob, her wallet will try to use transaction records with different amounts, which are summed up with the number of bitcoin that she wants to send to Bob.

Most likely, when Alice wants to send bitcoins to Bob, she will not have exactly the appropriate number of bitcoins from other transactions. Perhaps she only wants to send Bob 1,5 BTK.

None of the transactions that it has in its bit-address is designed for this amount, and none of them is summed up with this sum in combination. Alice can not simply divide the transaction into smaller amounts. You can spend the entire result of the transaction, rather than break it down into smaller amounts.

Instead, it will have to send one of the incoming transactions, and then the rest of the bitcoins will be returned to it as a change.

Alice sends two bitcoins, which she received from Jane, to Bob. Jane is the entrance, and Bob is the exit. But the amount is only 1.5 BTD, because that’s all she wants to send. Thus, her wallet automatically creates two exits for her transaction: 1.5 BTC to Bob and 0.5 BTD to the new address that he created for Alice to keep her change from Bob.

Are there any transaction fees?

Sometimes, but not all the time.

The transaction fee is calculated using various factors. Some wallets allow you to set transaction fees manually. Any part of the transaction that is not received by the recipient or returned as a change is considered a payment. This means that the miner is fortunate enough to solve the transactional block as an additional reward.

Currently, many miners process transactions without any fees. As the reward for bitcoins decreases, this will be less likely.

One of the unpleasant things about transactional charges in the past was that the calculation of these fees was complex and secret. This was the result of several updates to the protocol and is organically developing.

Updates to the core software processing bitlock transactions mean that it will change the way transaction transaction fees are handled, instead evaluating the lowest fee that will be accepted.

Can I get a receipt?

Receipt Bitcoin was not really intended for receipts. Although in version 0.9 there are changes that will change the work of payments, making them much more convenient and mature.
Payment processors, such as BitPay, also provide advanced functions that you would not normally get with your own bitcoin transaction, such as web pages for receiving and confirming an order.
What if I just want to send a bitcoin?

Bitcoin transactions are divided. For example, you can divide your biton into Satoshi. Satoshi is one hundred millionth bitcoins, and you can send a transaction size of 5430 satoshi to the bitcoin network. And your final recipient will receive the necessary record with the desired amount in his entry.

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