Title: Still searching for a "simple" explanation of how Bitcoin operates Post by: MG2R on November 26, 2013, 05:58:49 PM I know you're calculating hashes, that need to fit in to a predefined set of rules. I know that this hash needs to be based upon the previous block. What I don't know is how this correlates to "confirming a transaction", which is what I believe the mining to be the point. Am I missing something in this picture?
Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: MG2R on November 26, 2013, 08:11:18 PM Seriously, noone?
Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: PenAndPaper on November 26, 2013, 08:16:04 PM After finding the right hash a block that contains transactions is created and added to the end of the blockchain. Those transactions now cannot be reversed and people can't double spend.
Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: Damnsammit on November 26, 2013, 08:58:58 PM Just go here:
https://en.bitcoin.it/wiki/Confirmation When a hash is submitted that "solves" the block, then it is basically 1 of the 6 confirmations. Since the average block time is supposed to be 10 minutes, this makes a fully confirmed transaction 60 minutes. Most sites that allow you to spend Bitcoin will credit you after 1 confirmation, but some might go much higher. Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: PenAndPaper on November 26, 2013, 09:04:16 PM When a hash is submitted that "solves" the block, then it is basically 1 of the 6 confirmations. There isn't a thing like 6 confirmations. That number is an arbirtrary one. You need one confirmation for the transaction to be confirmed and anything else above that adds security for orphan blocks, network attacks etc. 6 doesn't mean anything else than that your transactions are more secured from having 5 confirmations and less secured from having 7. Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: waxwing on November 26, 2013, 09:08:00 PM I know you're calculating hashes, that need to fit in to a predefined set of rules. I know that this hash needs to be based upon the previous block. What I don't know is how this correlates to "confirming a transaction", which is what I believe the mining to be the point. Am I missing something in this picture? The block is basically a list of new transactions (new as in since the previous block). Each transaction is already confirmed in one sense - it has the signature of the owner(s) of the bitcoins that are going into it (i.e. the signatures of whoever's spending in that transaction). But this is only one level of confirmation - confirmation that, up to the last block, those signature owners still had those bitcoins. The problem would be that those owners could spend the same bitcoins into more than one transaction. That's the point of the blockchain; it creates one uniquely valid version of history - the only valid transaction history is the one in the longest chain of blocks. If two different blocks are created simultaneously, with the spending happening more than once, one of those blocks will become "orphaned" and ignored. Helping? Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: Damnsammit on November 26, 2013, 09:09:37 PM When a hash is submitted that "solves" the block, then it is basically 1 of the 6 confirmations. There isn't a thing like 6 confirmations. That number is an arbirtrary one. You need one confirmation for the transaction to be confirmed and anything else above that adds security for orphan blocks, network attacks etc. 6 doesn't mean anything else than that your transactions are more secured from having 5 confirmations and less secured from having 7. Truth. I'm just going off of an explanation that could correlate to the Bitcoin-qt wallet that shows "broadcasting" and then 0/6 confirms, etc. It keeps getting confirmed everytime a block is found. I guess it's just hard because a "simple" explanation of how Bitcoin operates doesn't really exist. lol The block is basically a list of new transactions (new as in since the previous block). Each transaction is already confirmed in one sense - it has the signature of the owner(s) of the bitcoins that are going into it (i.e. the signatures of whoever's spending in that transaction). But this is only one level of confirmation - confirmation that, up to the last block, those signature owners still had those bitcoins. The problem would be that those owners could spend the same bitcoins into more than one transaction. That's the point of the blockchain; it creates one uniquely valid version of history - the only valid transaction history is the one in the longest chain of blocks. If two different blocks are created simultaneously, with the spending happening more than once, one of those blocks will become "orphaned" and ignored. Helping? This is much more eloquent. Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: MG2R on November 26, 2013, 10:59:59 PM The block is basically a list of new transactions (new as in since the previous block). Each transaction is already confirmed in one sense - it has the signature of the owner(s) of the bitcoins that are going into it (i.e. the signatures of whoever's spending in that transaction). But this is only one level of confirmation - confirmation that, up to the last block, those signature owners still had those bitcoins. The problem would be that those owners could spend the same bitcoins into more than one transaction. That's the point of the blockchain; it creates one uniquely valid version of history - the only valid transaction history is the one in the longest chain of blocks. If two different blocks are created simultaneously, with the spending happening more than once, one of those blocks will become "orphaned" and ignored. Helping? Helping a lot, but the problem I have with that story is that the blockchain, basically, is a series of hashes. A hash, being an irreversible operation, doesn't tell you anything about the state of accounts. It's possible to put the information into the hash, but impossible to get it out of it. How in the hell do you verify that an account has x amount of BTC? Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: PenAndPaper on November 26, 2013, 11:29:57 PM You hash the block header to create the block but the block contains all the transactions in a readable format.
Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: johnhok on November 26, 2013, 11:38:32 PM I came across this video recently which explains how Bitcoins work. It's a pretty clear, simple, but thorough explanation of Bitcoin. Maybe it'll help you. I can't seem to post a link right now but search for "How Bitcoin Works Under the Hood" on YouTube and you should be able to find the video.
Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: mankster on November 26, 2013, 11:42:03 PM there is a good video on vimeo at the moment https://vimeo.com/63502573 that gives a very simple explanation
Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: PenAndPaper on November 26, 2013, 11:46:32 PM I can't seem to post a link right now but search for "How Bitcoin Works Under the Hood" on YouTube and you should be able to find the video. You can post a link. You just can't have it in your signature until you have 10 posts. Title: Re: Still searching for a "simple" explanation of how Bitcoin operates Post by: MG2R on November 27, 2013, 09:35:25 AM I came across this video recently which explains how Bitcoins work. It's a pretty clear, simple, but thorough explanation of Bitcoin. Maybe it'll help you. I can't seem to post a link right now but search for "How Bitcoin Works Under the Hood" on YouTube and you should be able to find the video. This actually is a VERY good video. It appears I had the wrong idea of what exactly a block is :) Thanks! |