What do we mean when we say that blockchain has transaction finality/immutability?
Once a transaction is on the blockchain, it has been verified and will remain forever.
How does this lead to the trustless environment that blockchain creates?
It creates an enviroment where one can do business with strangers. There can be no scam, no chargebacks. Transactions are verified and therefore, immutable.
All transactions committed to the blockchain cannot be reversed or altered (they are cut in stone). You cannot suddenly call back bitcoin that you might have sent and neither can anyone else.
We do not need to trust, we can verify transaction using mathematics and protocols. When a transaction has been completed it is done, no one can scam or cheat.
Finality
As explained in one of the first videos, blockchain is like a stone. Once you carve into the stone it is hard to reverse what has been done. Using physics and mining the blockchain logs transactions and the use of physical energy and the system of incentives and proof of work make transactions irreversible.
The ingredients that lead to a trustless system are: that all the nodes on the network are competing to authenticate the block, rooting out any fraudulent transactions. Because the network is decentralized this sets the system up to eliminate the need to trust that others are acting in good faith. Blockchain incentivizes good faith.
Homework on finality
Finality on the blockchain is reached when enough confirmations has been determined by the network. Once consensus is agreed by the network, there is finality to the transaction; it can no longer be undone. At this point, the transaction can now be seen by anyone looking on the blockchain. No third party can undo this transaction bringing finality to the transaction in a trustless way. With this system, it is especially important to be extra careful before sending a transaction and checking that it is indeed going to itās intended destination.
There is no need for trust as it is already built into the blockchains mathematical algorithm. Once the network has agreed and reached consensus, each node on the network now has the confirmed transaction for anyone to see on the blockchain. This gives blockchain the amazing property of allowing continuous transactions to be settled quickly in a trustless environment. This process is achieved via the block miners in a proof of work blockchain that powers Bitcoin.
ā My answers ā
1.once a transaction has been made, it has happened and you cant get it back.
2.you donāt have to worry about trusting the seller or a consumer to scam you out.
1.) Finality means a transaction cannot be reversed such as if I sent someone some bitcoin I could not reverse that transaction.
2.) A trustless environment is created where business can be done with strangers since all transactions can be verified.
Once a transaction is confirmed it cannot be reversed and is permanently stored on the ledger for all participants to see. It cannot be modified after confirmation without every participant in the network being convinced.
Transactions are confirmed mathematically, therefore, there is no need for a trusted 3rd party to validate a transaction and the transaction can only occur if it has been confirmed that it is possible. Once confirmed a transaction canāt be reversed (so chargebacks or claims of credit card fraud canāt be made).
When we say that blockchain has transaction finality/immutability, we mean that once a transaction has taken place, that transaction cannot be reversed or changed. It has been put into the system permanently.
This leads to the trustless environment that blockchain creates in that strangers are able to conduct business with one another.
2.You can do transactions with strangers because everyone relies on the math and the protocol.
The blockchain will verify the transaction
What do we mean when we say that blockchain has transaction finality/immutability?
Ans: Any transactions executed on the Blockchain can not be reversed or changed due to the consensus checks built into the network.
How does this lead to the trustless environment that blockchain creates?
Ans: The transactions are observable by everyone and can not be changed unless a high % of the network agrees to the change. This takes the concern of reliability and trust of the party opposite you in the transaction out of the equation. Placing trust in the network to manage these concerns.
We mean that once the transaction has happened, itās done and it is irreversible.
It brings more confidence in doing business and buying, as it prevents anyone to cancel the transaction for scamming purposes.
1. What do we mean when we say that blockchain has transaction finality/immutability?
Transactions are final; once a transaction has happened it has happened. Thereās no way to reverse is.
2. How does this lead to the trustless environment that blockchain creates?
Since there is no way to reverse a transactions (like you could do by calling your bank, paypal etc.) a seller can trust that the customer will pay for the goods or services delivered and doesnāt scam the seller by recalling the payment. With blockchain trust is provided by the system itself and not by the people using the system.
Finality Homework
We say blockchain has transaction finality because there is no way to reverse it. Transactions are final and their record will be in the blockchain forever.
This leads to the trustless environment that blockchain creates because people who donāt know each other can do business without fear of being scammed. I donāt have to trust a stranger, I trust the system that allows me to verify it mathematically.