Bitcoin Network
Aug 11, 2024
In traditional finance (TradFi), users rely on centralized intermediaries like banks to record financial transactions. Users have to periodically check their bank account statements to ensure banks are correctly updating transaction data. However, blockchain-based crypto transactions and decentralized finance (DeFi) don’t rely on third parties. Instead, a decentralized network of miners and stakers validate transactions and record them on a publicly available distributed ledger.
Thus, anyone can verify blockchain transaction history to maintain complete transparency in the financial sector. In crypto, the usual saying is, “Don’t trust, verify”, meaning instead of trusting someone, you can directly verify their claims. For example, if someone says they made a payment in BTC, you can verify it on the Bitcoin chain. You will know the transaction status and find out if it’s confirmed or unconfirmed.
Similarly, if you think a decentralized application (dApp) is deducting incorrect BTC for their services, you can check and stop it. You can verify every BTC transaction that you send and receive to keep track of your transaction history and prevent fraudulent usage.
What Is a Bitcoin Block Explorer?
A Bitcoin block explorer is a tool, webpage, or application that provides information about individual transactions, wallet addresses, and blocks on the Bitcoin network. It functions as a search engine for the entire Bitcoin transaction history, like a digital encyclopedia to look for specific on-chain data.
Users can navigate the data on the Bitcoin network through Bitcoin block explorers, providing an interface to read the blockchain. These block explorers use a relational database to organize transaction data in a table format for efficient information query and retrieval.
Bitcoin block explorers use Structured Query Language (SQL), earlier known as SEQUEL, to interact and extract information from the underlying database. Sometimes, developers can deploy APIs to programmatically communicate with Bitcoin block explorers for third-party applications like wallets, trading tools, and analytics platforms.
Some prominent Bitcoin block explorers available for users are Blockchain.com’s block explorer and Bitcoin.com’s Blockchair. Many users also opt to go to Mempool.space.
Why Should You Use a Bitcoin Block Explorer?
People use Bitcoin block explorers to view a BTC transaction’s details, wallet histories, confirmation status, orphaned blocks, fees, and other information. These data points serve multiple purposes for different stakeholders in the crypto industry.
Enhanced transparency: Bitcoin block explorers enable users to verify transactions and fund transfers across wallet addresses for more clarity. Instead of trusting centralized intermediaries, users can directly verify the Bitcoin transaction data on block explorers.
Conduct due diligence: Users can bolster their transaction security by exploring transaction histories to ensure the counterparty’s authenticity and make informed financial choices. Bitcoin block explorers provide an opportunity to prevent scams and fraudulent transactions by verifying crypto wallet activities.
Facilitate research and analysis: Blockchain research firms, analytics companies, and security agencies can inspect Bitcoin transactions through block explorers. They can track on-chain activity and transaction patterns for research purposes to improve the health and other services within the Bitcoin ecosystem.
How Do You Read a Bitcoin Block Explorer?
A Bitcoin block explorer displays several pieces of information like senders, recipients, transaction amounts, fees, and transaction confirmation status. It may seem a bit confusing to read transaction data from a Bitcoin block explorer so let’s understand each component separately.
Transaction hash/ID: Each BTC transaction has a unique ID or transaction hash that functions as the specific transaction’s identifier. The ID or hash is a string of alphanumeric data that contains all the information about the particular transaction. If you want to find out the transaction details, copy-paste the ID or hash into the Bitcoin block explorer’s search bar and press enter.
Sending address: The sender’s address is the Bitcoin wallet address from which a transaction has originated. The address reveals how much BTC it is sending to a recipient. If you click on the sending address, you can see other details like the wallet address’ incoming and outgoing transaction history.
Receiving address: The recipient’s address is the destination Bitcoin wallet address that receives the transaction. The address shows how much BTC it is receiving from the sender. When you click on the receiving address, you can see other information like the wallet address’ complete transaction history.
Transaction fees: Each Bitcoin transaction has a corresponding fee that goes to the miners for validating transactions. Users can check the BTC fee for a particular transaction on a Bitcoin block explorer.
Transaction status: A BTC transaction is complete and becomes valid after miners check and add it to the Bitcoin chain. Every new block that miners add after a block of valid transactions offers additional security and prevents double-spending.
Bitcoin block explorers enable users to check the confirmation status of a particular BTC transaction. Some transactions have a higher confirmation time depending on the Bitcoin network congestion.
How to Read a Bitcoin Block Explorer with Leather
You can use Leather with a Bitcoin block explorer to find more details about a particular BTC transaction or your entire wallet’s history. If you want to know about a specific transaction made with your Leather, follow the steps below:
Step 1: Open Leather and find the transaction about which you want more information.
Step 2: Copy the transaction ID or hash of the specific transaction.
Step 3: Open your preferred Bitcoin block explorer.
Step 4: Paste your transaction ID or hash on the explorer’s search bar and see the transaction details.
You can view your complete wallet history from Leather. However, if you wish to check the transactions on a Bitcoin block explorer, follow the steps below:
Step 1: Open Leather and select your wallet address by clicking on ‘Receive’.
Step 2: Copy the wallet address.
Step 3: Open your preferred Bitcoin block explorer.
Step 4: Paste your wallet address on the explorer’s search bar to see your complete transaction history and crypto balance.
