A cryptocurrency transaction is the process of transferring digital assets, like Bitcoin or Ethereum, from one person to another on a blockchain network. It works similarly to sending money online but uses a decentralized system.
How does a cryptocurrency transaction work?
Initiation:
The sender starts the transaction by entering the recipient's cryptocurrency address and the amount to send in their wallet.Verification:
The transaction is sent to the blockchain network, where it is verified by nodes (computers) to ensure it is valid.Confirmation:
Once verified, the transaction is added to a block on the blockchain. This step makes the transaction permanent and secure.Completion:
The recipient receives the funds in their wallet after the transaction is confirmed.
Key features of cryptocurrency transactions
Fast and global: Transactions can be sent anywhere in the world within minutes.
Immutable: Once completed, a transaction cannot be changed or reversed.
Transparent: Details like the amount and addresses involved are recorded on the blockchain and can be viewed publicly, though identities remain private.
A cryptocurrency transaction ensures secure and efficient transfers of digital assets without the need for intermediaries like banks. Always double-check the recipient's address before sending funds.