Understanding Blockchain in plain English (~3500 words)
1–9 of 9 posts
Re: Understanding Blockchain in plain English (~3500 words)
#2How is the order of transactions finalized in a block before the block has been mined?
Re: Understanding Blockchain in plain English (~3500 words)
#3Few questions:
The people that are "mining" are using their computing power to seal other people's transactions?
Also, what happens when there are no more bitcoins to be rewarded. (When mining is no longer profitable by any means)
Thanks
Re: Understanding Blockchain in plain English (~3500 words)
#4Few questions: The people that are "mining" are using their computing power to seal other people's transactions? Also, what happens when there are no more bitcoins to be rewarded. (When mining is no longer profitable by any means) Thanks
To your first question: yes, that is exactly what they're doing.
To your second: there is a fee associated with every transaction. You can set the fee to something incredibly small (like 0.00001 cent), but miners will take the higher-fee transactions first, so you'll be waiting a long time.
So even after the block reward drops to zero, theoretically miners will still have an incentive to keep processing transactions.
Re: Understanding Blockchain in plain English (~3500 words)
#5Few questions: The people that are "mining" are using their computing power to seal other people's transactions? Also, what happens when there are no more bitcoins to be rewarded. (When mining is no longer profitable by any means) Thanks
To your first question: yes, that is exactly what they're doing. To your second: there is a fee associated with every transaction. You can set the fee to something incredibly small (like 0.00001 cent), but miners will take the higher-fee transactions first, so you'll be waiting a long time. So even after the block reward drops to zero, theoretically miners will still have an incentive to keep processing transactions.
I would imagine that at some point, maybe in 100 years, mining may not reward you more than the cost of electricity to mine. Miners won't bother continue--how will bitcoins continue to be hashed? thanks apeace!
Re: Understanding Blockchain in plain English (~3500 words)
#6How is the order of transactions finalized in a block before the block has been mined?
Every transaction is added in the block in the order they happened. Every transaction has a timestamp associated with it.
Re: Understanding Blockchain in plain English (~3500 words)
#7Earlier quoted context omitted.
To your first question: yes, that is exactly what they're doing. To your second: there is a fee associated with every transaction. You can set the fee to something incredibly small (like 0.00001 cent), but miners will take the higher-fee transactions first, so you'll be waiting a long time. So even after the block reward drops to zero, theoretically miners will still have an incentive to keep processing transactions.
I would imagine that at some point, maybe in 100 years, mining may not reward you more than the cost of electricity to mine. Miners won't bother continue--how will bitcoins continue to be hashed? thanks apeace!
Transaction fees will keep increasing (because of demand) and we would have moved to renewable electricity by then (free electricity), therefore miners continuing mining.
That's my opinion.
Re: Understanding Blockchain in plain English (~3500 words)
#8How is the order of transactions finalized in a block before the block has been mined?
Every transaction is added in the block in the order they happened. Every transaction has a timestamp associated with it.
This is completely untrue. "Transactions are added to the new block, prioritized by the highest-fee transactions first and a few other criteria."
You can read more about this https://bitcoin.stackexchange.com/questions/35697/what-is-cr..., but the TL;DR is when the txs are broadcast by various nodes, the highest fee txs are included first (for the most part) by the miners.
Re: Understanding Blockchain in plain English (~3500 words)
#9Earlier quoted context omitted.
To your first question: yes, that is exactly what they're doing. To your second: there is a fee associated with every transaction. You can set the fee to something incredibly small (like 0.00001 cent), but miners will take the higher-fee transactions first, so you'll be waiting a long time. So even after the block reward drops to zero, theoretically miners will still have an incentive to keep processing transactions.
I would imagine that at some point, maybe in 100 years, mining may not reward you more than the cost of electricity to mine. Miners won't bother continue--how will bitcoins continue to be hashed? thanks apeace!
The invisible hand of the market. In 100 years, if bitcoin transactions are still of value, then miners and people making transactions will come to an agreed upon transaction fee that will be suitable for both parties. And If miners drop out, transaction fees will go up.