Tracking Bitcoin Transactions, Explained
How can I track Bitcoin transactions?
Through block explorers and dedicated services offered by some crypto exchanges.
Unlike banks, where it can be difficult to find out information about details about transactions that are currently being processed — as well as those that have been completed — the blockchain offers far greater levels of transparency.
Anyone can search for information based on particular Bitcoin addresses, block numbers and transaction hashes. This, when coupled with wallet explorers, means it becomes possible to draw connections between addresses and the wallets being used to hold Bitcoin.
Of course, this will prove exceptionally useful if you’re worried about whether your crypto has gone to the right destination — or are wondering whether the transaction has been verified. But it’s worth remembering that these tools are also practical for law enforcement agencies that are attempting to clamp down on BTC being used for illegal means.
Are there any benefits to transaction trackers?
There are an extraordinary number of potential applications.
When you are using a crypto exchange, transaction trackers can help you to double-check whether their trading platform is operating normally, and how long a transaction may take to finalize. This can provide valuable information in advance of a payment being made, as long delays may mean you choose to rely on a different provider instead.
It is possible that relying on some of these trackers can help you to be better prepared from a tax perspective too, and easily assess how your crypto portfolio has been performing. In the dreaded scenario that crypto has been sent by mistake, you’ll also have the opportunity to find out which address received it. Unfortunately, however, this is by no means a guarantee that you’ll get it back.
How do I avoid stuck transactions?
To begin with, it’s important to ensure that you’re paying sufficient fees.
Over the years, the number of transactions being executed over the Bitcoin network has continued to increase apace. This has meant that miners end up prioritizing transactions with higher fees, including these in their blocks first.
When a crypto transaction is sent with a lower fee, it can take hours, days and potentially weeks for it to be confirmed. Such long delays normally indicate that the transaction is continually being outbid, and miners have little incentive to get it cleared. As a result, it ends up languishing in a mempool, waiting longingly for a block to come along.
Crypto wallets — and some exchanges — have started to help users achieve the best chance of their transaction being verified the first time around. Some monitor network activity and enforce dynamic fees, meaning the charges attached to each transaction fluctuate based on how busy miners are. If you are in a rush, it is also possible to manually add a higher fee to boost your chances of a speedy execution. Conversely, if you’re not a rush, you can save money on fees and accept it might take a little longer for your funds to reach the recipient.
Why do Bitcoin transactions take so long?
Scalability has long been an issue on the Bitcoin network.
For a transaction to be finalized, it usually has to be confirmed six times before it is sent over to the recipient. This, when coupled with the high levels of demand that was mentioned before, means that it can take anywhere from 10 minutes to a day for transactions to clear — or even longer in some circumstances.
Bitcoin’s scalability issue has been a long-running issue for many years. The network is only capable of processing approximately seven transactions per second, meaning it pales in comparison to payment behemoths such as Visa. Workarounds such as the Lightning Network, which adds another layer to the blockchain to deliver instantaneous payments with lower fees, have been introduced, but it’s fair to say that even these solutions haven’t had the levels of traction expected.
Can Bitcoin transactions be cancelled?
This is a very common question, but the answer is no.
Blockchains are designed to be irreversible, and once a transaction has been committed to a network, control falls out of your hands.
This is why it is imperative to check, double-check and triple-check before you are sending crypto transactions of a high value to ensure that you haven’t made any typographical errors in the address. It’s also worth verifying that you’re sending the right amount of crypto.
How can I be informed of what’s happening with my crypto transactions?
Some crypto exchanges are aiming to deliver full transparency to their users.
This attitude toward openness can be especially beneficial for users who are using Bitcoin and other cryptocurrencies for the first time.
HitBTC, which bills itself as one of the most advanced crypto exchanges on the market today, has created a System Monitor that delivers live statistics concerning incoming and outgoing transactions for each of the cryptocurrencies it supports. Processing times for the last 100 transactions are provided — detailing the slowest and fastest execution times as well as the average for the group. Information about maintenance operations also offers updates about any improvements being made to the platform that might briefly affect transactions.
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