How can you verify if a bitcoin is real?

[StaffsLebowski]

Hi All,

First post so please be gentle!. I'm trying to get familiar with crypto currency and understand 'how it works'. I've reached a block and I'm hoping someone can shed some light on a particular point.

I understand the process of using public and private keys, back from the time when Phil Zimmermann created PGP. PGP allowed a user to encrypt a file, eg: an email/file (technically, just a bunch of ones and zeros) so that when the other user decrypted the file, they would see the words/file again. Or, to phrase it another way, the encryption was just a 'wrapper' for the content - ie, the words in my email or the file I sent.

Now, if someone sent me a bitcoin, how would I know what I was looking at? With an encrypted email, once decrypted I would be able to see something (text/file) and realise that I had actually received something. But, if someone sent me a bitcoin, what would I be looking at when I decrypted with my private key? A file filled with ones and zeros? Or maybe a simple text file with words inside saying, "Hey, this is 1 bitcoin!"

Can someone shed some light on what it I actually receive when I purchase a bitcoin and how I can verify that what I have 'in my hands', is actually a bitcoin and not just a bunch of ones and zeros? I understand that the blockchain is supposed to verify what is what but, what if I wanted to pass my bitcoin directly to you without the blockchain. Again, how would I know, what I received - was a bitcoin?

Thank you for your time and patience with my lack of understanding!

Regards,

Staffs Lebowski..

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[aleksej996]

You can't send bitcoins without a blockchain. It is not that simple. Depending on how far you want to research this, it can get quite complicated.

The point is that you don't encrypt anything with public key cryptography in Bitcoin, it is used only for signing instead. (encrypting the hash is a signature)
When you send bitcoins you sign a transaction which says which public key (address) will be able to send these coins in the future.
This transaction is then validated by the entire network and miner's add it into a block. If miner's add an invalid transaction into a block, their block will be considered invalid by the rest of the network and other miners will ignore their block as it never happened.

[StaffsLebowski]

<<Depending on how far you want to research this, it can get quite complicated>>

Complex is OK. I prefer to spend 100 days trying to understand than blindly accepting the things I don't.

I'm sorry but struggling to understand this point you made: <<When you send bitcoins you sign a transaction which says which public key (address) will be able to send these coins in the future.>>

Could you ellborate?

[Pekine]

Buy bitcoins from a reknown broker. Look up for some references around the broker. Depending on the country you might have differnent brokers.

[chenging14]

Enter your Bitcoin address (the one you were paid into) into a public blockchain browser such as https://blockchain.info/. That will show you the relevant entries in the global shared Bitcoin ledger, which confirms that you, as the holder of the private key for that address, are the owner of those funds.

[FrueGreads]

I see a lot of confusion there, but that is perfectly normal since you are new in this area apparently. First, and like some users pointed out, there is no bitcoin without blockchain. You must understand that we have the blockchain technology, that basically is just a record of blocks that are linked and secured by cryptography. The blockchain technology is what guarantees that whatever information you receive using that technology is real. This is what miners do, they make sure the blocks (records of transactions made between users) are valid/real before they are added to the blockchain.

Now bitcoin, is just a protocol, or a "set of rules", that runs on the blockchain. So you don't need to do anything to make sure that the bitcoin you have is real, because it's held on the blockchain, and is that technology that makes sure that the bitcoin transaction you just received is real (that tx is on a block that is added to the blockchain, and all that is verified by miners).

[HeRetiK]

<<Depending on how far you want to research this, it can get quite complicated>>

Complex is OK. I prefer to spend 100 days trying to understand than blindly accepting the things I don't.

I'm sorry but struggling to understand this point you made: <<When you send bitcoins you sign a transaction which says which public key (address) will be able to send these coins in the future.>>

Could you ellborate?

Bitcoins are not stored as balances, but rather as the sum of incoming and outcoming transactions.

A transaction is basically a signed message that says: "Alice sends Bob 1 BTC". What miners and nodes do is, they 1) verify whether the message has been signed by Alice and not and impostor and 2) they verify whether Alice actually has the funds (read: a sufficient amount of BTC in incoming transactions) to send Bob 1 BTC. If both is true, Bob himself now has a sufficient amount of BTC in incoming transactions to send 1 BTC.

Basically, you can verify whether a bitcoin is "real" by following this chain of transactions upstream until you reach the block where the coins have been mined. Mined coins are issued in a special kind of transaction that requires no inputs. The integrity of this special issuance transaction and the block that enabled it, is given due to the blocks that are mined on top of it, ie. the blockchain.

Here's a more detailed, technical information on transactions as transactions are actually little scripts and not just simple messages:
https://en.bitcoin.it/wiki/Transaction

Wallet and blockchain explorers such as blockchain.info interpret this ledger of transactions (ie. the blockchain) for you so that you don't have to follow each transaction back to its source yourself.

[VitKoyn]

Can someone shed some light on what it I actually receive when I purchase a bitcoin and how I can verify that what I have 'in my hands', is actually a bitcoin and not just a bunch of ones and zeros? I understand that the blockchain is supposed to verify what is what but, what if I wanted to pass my bitcoin directly to you without the blockchain. Again, how would I know, what I received - was a bitcoin?

You can't make a fake Bitcoin and even you can create fake transaction, network will definitely reject it, and you can't create new Bitcoin without having 51% of Bitcoin mining hashing power. So if you receive Bitcoins in your Bitcoin wallet it is surely an authentic one, or if you are still not satisfied, you can copy the transaction ID of your transaction and paste it on block explorer, if you can see that your Bitcoin is recorded there or the transaction status is confirmed then it is real. It is impossible for anyone to transfer Bitcoin without blockchain because all transactions are recorded in blockchain, unless you give the ownership (private key) of your Bitcoin wallet to other people, that's the only possible way to transfer Bitcoin without creating a transaction.

[HG_Lincs]

You're going to want to understand how Block chain works, before you get into the Crypto Currency part.
Once you have an understanding of the Blockchain, everything else comes easy

Wish you all the best in your Crypto Journey!
And please.. Don't be another moron who goes and sells his kidney and sells his kid on the black market so he can buy into this thing.
Crypto Currency is going nowhere for a long time. It will still be here after you have a vast understanding and a bunch of cash you don't mind potentially losing.

[btcgreen63]

In addition to what others have said, you can query the blockchain network to ask how much BTC is associated with a public address. You can do this for any public address, since the ledger is public.

Check out blockchain.info for example. Click on a block number to see the list of transactions in the block. Then scroll down and click on one of the Bitcoin addresses to see the amount of bitcoin in that address.

[StaffsLebowski]

Hi and thanks to all for chipping in with your input but..

I must say I'm still missing something - and I'm happy to say, maybe something has clicked yet for me..

I know the blockchain verifies that a trail of events (transactions) remains true, this is it's purpose. If you read the article on the bitcoin wiki (https://en.bitcoin.it/wiki/Secure_Trading) it says that "Bitcoin users may want to trade bitcoin directly with each other in what is known as an over-the-counter market", this suggests that I can pass a bitcoin directly from my wallet to your wallet without the blockchain. Or when the say "directly" do they mean by-passing exchanges etc?

[mistanama]

Hi All,

First post so please be gentle!. I'm trying to get familiar with crypto currency and understand 'how it works'. I've reached a block and I'm hoping someone can shed some light on a particular point.

I understand the process of using public and private keys, back from the time when Phil Zimmermann created PGP. PGP allowed a user to encrypt a file, eg: an email/file (technically, just a bunch of ones and zeros) so that when the other user decrypted the file, they would see the words/file again. Or, to phrase it another way, the encryption was just a 'wrapper' for the content - ie, the words in my email or the file I sent.

Now, if someone sent me a bitcoin, how would I know what I was looking at? With an encrypted email, once decrypted I would be able to see something (text/file) and realise that I had actually received something. But, if someone sent me a bitcoin, what would I be looking at when I decrypted with my private key? A file filled with ones and zeros? Or maybe a simple text file with words inside saying, "Hey, this is 1 bitcoin!"

Can someone shed some light on what it I actually receive when I purchase a bitcoin and how I can verify that what I have 'in my hands', is actually a bitcoin and not just a bunch of ones and zeros? I understand that the blockchain is supposed to verify what is what but, what if I wanted to pass my bitcoin directly to you without the blockchain. Again, how would I know, what I received - was a bitcoin?

Thank you for your time and patience with my lack of understanding!

Regards,

Staffs Lebowski..

Try to join the bitcoin community and explore you. You can see people working hard to earn money. Or try to find out on how bitcoin helps people. Determine how much bitcoin value or price you are overwhelming in the price you see. Try to join the campaign and get along with others posting comments and more and you decide what bitcoin can do. You'll be able to see that by finding forum questions and answers.

[HeRetiK]

Hi and thanks to all for chipping in with your input but..

I must say I'm still missing something - and I'm happy to say, maybe something has clicked yet for me..

I know the blockchain verifies that a trail of events (transactions) remains true, this is it's purpose. If you read the article on the bitcoin wiki (https://en.bitcoin.it/wiki/Secure_Trading) it says that "Bitcoin users may want to trade bitcoin directly with each other in what is known as an over-the-counter market", this suggests that I can pass a bitcoin directly from my wallet to your wallet without the blockchain. Or when the say "directly" do they mean by-passing exchanges etc?

This article you are referring to seems to be a little dated, as nowadays you're better off just buying Bitcoin on exchanges such as Bitstamp or Kraken. P2P trades are nowadays mostly done using Bitcoin.de or LocalBitcoins, which take care of escrow for you.

Note that trading Bitcoin is something different from sending a Bitcoin transaction. Sending a Bitcoin transaction is just that, a transaction as described in the posts above. Trading involves you exchanging bitcoins for goods or services or other currencies, such as USD or EUR. How the goods, services and other currencies are provided depends on the trade or trading platform (eg. it could be a wire transfer, it could be handing over cash). The bitcoins themselves however will still be send over the blockchain. You will know that you succesfully received your bitcoins when your wallet shows an incoming transaction with at least 1 confirmation. Recommendation being 6 confirmations, however 1 confirmation should suffice for normal everyday transactions.

In other words: Sending a Bitcoin transaction is like handing over cash. Trading bitcoin is like you handing over cash and receiving a piece of gum (or the other way round). The blockchain only takes care of handing over the cash. The tricky part is making sure that the gum is actually received. This has nothing to do with Bitcoin and that's were exchanges come into play.

[Apple Mac]

Buy bitcoins from a reknown broker. Look up for some references around the broker. Depending on the country you might have differnent brokers.

Well I think this is true given the fact that you can earn here is one of the greatest evidence as well as the transaction made withbthe monetary unit of Bitcoin, this currency is indeed a great crypto which is technically cant be hold with our bare hands but when you convert it on your local money then youll realized Bitcoin is real.

[peterko]

Yes the safest and easiest method to make sure the bitcoin you got is real is to get it through verified exchanges. If you go to sites that states buy bitcoin now but you have not heard of the site before, just leave it. It's always better to be safe than sorry.

[mmhaimhai]

If you already have a bitcoin wallet then anything you received on it is really bitcoin, I haven't heard of a fake bitcoin though. The about sending bitcoin without blockchain, that would be impossible dude, because all btc transaction are sent to blockchain in order to get process.

[izanagi narukami]

Bitcoin is not real in physical form but you can own it like owning paypal balance. Once you have create a wallet , just deposit some bitcoin by converting your local money into btc and start holding like you're holding your GOLD.

Trust me, bitcoin can change your LIFE if you start invest Now.

[QuestionAuthority]

[FlintJuan]

Any transaction issued with Bitcoin cannot be reversed, they can only be refunded by the person receiving the funds. That means you should take care to do business with people and organizations you know and trust, or who have an established reputation.

[Dravenz]

Some effort is required to protect your privacy with Bitcoin. All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances.