Bitcoin Transaction

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A Bitcoin Transaction is a blockchain transaction that involves bitcoins on the Bitcoin system.



References

2015

  • http://www.economist.com/blogs/graphicdetail/2015/01/daily-chart-3
    1. ) Payers initiate a bitcoin payment using "wallet" software.
    2. ) This and other pending transactions are broadcast on the global bitcoin network.
    3. ) Once every ten minutes or so, "miners", specialised computers (or groups of computers) on this network, collect a few hundred transactions and combine them in a "block".
    4. ) In order to mine a block and validate the transaction, miners compete to solve a difficult mathematical equation (a "hash function"). The miner that solves the equation first further processes the block and broadcasts this "proof-of-work" to the bitcoin network.
    5. ) The other miners check the proof-of-work and the validity of the transactions. If they approve, the winning miner gets a reward of 25 newly minted bitcoin (about $6,900 at current prices), which is the incentive for miners to provide computing power. Adjusting the difficulty of the puzzle ensures that the supply of new bitcoins remains steady.
    6. ) The mined block is added to the "blockchain", a big, unbreakable ledger that lives on the bitcoin network and serves as a record of all transactions.
    7. ) The payee can use his wallet software to see whether the bitcoin have arrived.