Confirmations Definition
In the context of blockchain and cryptocurrencies, a confirmation refers to the act of an operation (like a transaction or trade) being verified and permanently included in the blockchain. This process occurs through the creation of new blocks, which contain recent transactions, and their subsequent addition to the chain of existing blocks (the blockchain).
Confirmations Key Points
- A confirmation validates and permanently adds a transaction to the blockchain.
- Each additional block to the blockchain after the one containing the transaction is counted as another confirmation.
- Multiple confirmations increase the assurance of a transaction’s validity.
- Longer confirmation times can result in slower transaction processing times.
What are Confirmations?
Confirmations are a key aspect in maintaining the security and integrity of the blockchain. It is the process by which transactions are verified and added permanently to the blockchain. This is done through mining, where complex computational problems are solved to create new blocks. Once these blocks are linked into the blockchain, the transactions within them are said to be ‘confirmed’.
Why are Confirmations important?
Confirmations are crucial because it’s the process that ensures transactions on the blockchain are valid and cannot be tampered with. Once a transaction is confirmed, it is permanently recorded on the blockchain. Therefore, every new confirmation, which effectively adds a block to the chain, makes the transaction more secure as it gets harder to alter older transactions.
Where and When does Confirmation take place?
Confirmations occur within the decentralized network of computers, or ‘nodes’, that make up a blockchain. When a transaction takes place within the network, it is not immediately added to the blockchain. Instead, it’s first placed within a new block which must then be confirmed through a process of computational problem solving known as mining. This can happen at any time – 24/7, 365 days a year – as long as the network is operational.
How does Confirmation process work?
In the confirmation process, once a transaction has been included in a block, it has received its first “confirmation”. As more blocks get added after this block in the blockchain, each one counts as additional confirmation. The more confirmations a transaction has, the harder it would be to reverse it, making the transaction more secure. On networks like Bitcoin’s, the confirmation process typically takes around 10 minutes per block.
Who are involved in the Confirmations process?
The confirmation process primarily involves miners. These are the nodes within the blockchain network which apply computational power to solve complex mathematical problems. This problem-solving results in the creation of new blocks containing recent transactions, which are then confirmed and added to the blockchain. Users of the blockchain who initiate transactions also play a role, as their activities provide the transactions that the miners confirm.
