Network mechanics
From signed transaction to confirmation
A Bitcoin transaction begins when a sender cryptographically signs an unspent transaction output with their private key, designating recipient addresses and miner fees. This payload broadcasts across a peer-to-peer network, where independent nodes verify the signature against consensus rules. Valid transactions enter the mempool—a staging area of unconfirmed transfers—where miners prioritize transfers by fee density.
Miners assemble candidate blocks and compete to solve the Proof-of-Work cryptographic puzzle. Once a miner finds a valid hash, the block propagates across the network, is verified by nodes, and permanently appends to the blockchain. As subsequent blocks are mined atop it, confirmations accumulate. Unlike card networks settling through intermediaries over days, Bitcoin achieves deterministic finality directly at the protocol layer.
Transaction path
- Wallet signs
- Peers relay
- Miner includes
- Block confirms
Self-custody makes key management part of the user experience; an exchange account has a different custody model.