Transaction confirmation

Transaction confirmation is necessary to prevent the same funds from being spent twice.

Typically, when receiving cryptocurrency, the new owner cannot immediately dispose of it. Once a transaction is completed, it is sent to the blockchain network for execution and must be included in a block to become legitimate.

The process of including a transaction in a found block is called transaction confirmation. Inclusion in 1 block = 1 confirmation, when 6 or more such confirmations are collected, the transaction is considered confirmed. This function was introduced to protect against repeated spending of cryptocurrency.

The inclusion of a transaction in a block occurs during the mining process.

A classic Bitcoin client will display a transaction as “unconfirmed” until there are 6 confirmations (6 blocks found). Sites or services that accept Bitcoin for payment for their goods or services may set their own restrictions on the number of blocks needed to confirm a transaction. The number 6 was not chosen by chance: it is based on the theory that the likelihood that an attacker could accumulate more than 10% of the network hashrate to forge transactions is small, and that a negligible risk (less than 0,1%) is acceptable.

For attackers who do not have significant power, 6 confirmations are an insurmountable barrier to an attack. In turn, people with more than 10% power will not have difficulty getting 6 confirmations in a row. However, having such computing power requires an investment of millions of dollars, which reduces the risk of attack.

Bitcoins, which are issued by the network for finding a block, can only be used after 100 confirmations, i.e. 100 blocks found. The classic Bitcoin client will not display the coins received for solving a block until 120 confirmations have accumulated.