Verifying Bitcoin Transactions: A Step-by-Step Guide
Bitcoin, the world’s first decentralized digital currency, is built on a peer-to-peer network that relies on cryptography and complex mathematical algorithms to secure transactions. Essentially, verifying the input and output of transactions made in Bitcoin involves several key steps, not just accessing the blockchain. In this article, we’ll walk you through the process of verifying these transactions using the example provided as an example.
۱. Step 2: Extract the transaction data
Start by extracting the relevant information from the transaction data. The “vin” (verifiable input) list contains a single transaction with the following information:
txid: The unique identifier of the transaction.
vout: A list of outputs associated with the transaction.
The first output (vout[0]) is the one we’ll focus on. It indicates the amount being sent from the sender’s wallet.
۲. Step 2: Calculate the result
To verify the input, calculate the result based on the sender’s balance and the fees paid for the transaction. The formula is to multiply the sender’s balance by the per-byte fees (not included in the submitted data) and then divide by the total byte length of the transaction.
The resulting output value (out).
۳. Step 2: Calculate the fees
Calculate the fees associated with the transaction, which include the gas price and any mining or network fees. The formula involves multiplying the per-byte fees by the total byte length of the transaction.
The amount of the reward thus obtained (“reward”).
۴. Step 2: Verify the output
Ensure that the result matches the expected value based on the sender’s balance and the fees calculated in Step 2. If the outputs do not match, the transaction is considered invalid and cannot be confirmed.
If the confirmation is successful, update the “blockchain” (not shown in this example) with the confirmed input and output values.
۵. Step 2: Update the transaction hash
Update the transaction summary by recalculating it using the updated inputs and outputs. The formula contains a cryptographic hash of the entire transaction data.
The resulting updated transaction hash.
Example presentation
Assuming we have the following transaction data:
- “txid”: 1d8f38f6a5fbc7951568f64f3b9320a4ebd1053dce4641a5c5526d3cd7a805e1
- “vout[0]”: 10 BTC (value: 100000.00 USD)
- Per-byte Payments: $50.00
Based on the given example, we calculate:
- Output value (“out”): 100000.00 USD
- Reward amount (“reward”): $5,000.00
- Updated transaction digest: 1d8f38f6a5fbc7951568f64f3b9320a4ebd1053dce4641a5c5526d3cd7a805e1 + 50.00 USD (gas price) = 1d8f38f6f6f3b3b7f6f3b3b dce4641a5c5526d3cd7a805e1+5000.00 USD
Conclusion
Checking the input and output of a Bitcoin transaction requires several key steps, not just accessing the blockchain. By following these steps using the example provided in this article, you can understand how you can check transactions on the Bitcoin network without needing to know the details of the blockchain.
