Homework on Finality - Questions

[Isaka]

Homework on Finality - Questions

1. What do we mean when we say that blockchain has transaction finality/immutability?
   That any transaction on the blockchain is final. When its done and verified it can never be undone.

2. How does this lead to the trustless environment that blockchain creates?
   If there is now to undo transactions, that means that the people involved only have to trust themselves and the math behind the blockchain technology, which has no bias. This is considered trustless.

[Mauro]

@gogocrypto

It is mathematically impossible.

It is possible. But it is not an easy thing to do. Especially in bitcoin.

[Mauro]

@eltoro

Payments cannot be reversed as in chargebacks.

Great example/comparison.

[Mauro]

@Speedster

This solves the double spend problem where a person might try to use the same dollar twice. For example it prevents someone buying something online and then once its delivered calling their bank and claiming the purchase was fraud, thus keeping the goods and the money and being able to spend the money again.

Directly from the original bitcoin white paper:

"A purely peer-to-peer version of electronic cash would allow online
payments to be sent directly from one party to another without going through a
financial institution. Digital signatures provide part of the solution, but the main
benefits are lost if a trusted third party is still required to prevent double-spending.
We propose a solution to the double-spending problem using a peer-to-peer network."

Imagine how difficult was to accept this statement when bitcoin was first to introduced to the world.

@Speedster

A drawback of this system is that if the sender makes a mistake and sends to the wrong address there is no recourse to have the transaction nulled or reversed. This responsibility is part of taking over the banking function in your life.

Well said. Your homework is awesome!

I tweeted you post: https://twitter.com/Mauro4897/status/1274708992917409792

[N8ture]

1, The transaction has finality means that it cannot be reversed. Once a transaction is on the blockchain it is there forever.

2. Blockchain finality/immutability leads to a trustless environment because each individual user can trust in the system that transactions will not be reversed. This allows them to transact with people they may not trust or complete strangers without fear of a transaction being reversed or halted.

[mark.mosley]

The transactions in the blockchain are permanent, cannot be changed. The blockchain is a mirror of the passage of time.

This permanence of the blockchain means that all parties to a transaction can rely on the recorded information as truth. They need not be concerned that the transaction will, in some way, change in the future.

[Mauro]

@Pkgno1

It means that once the transaction has one confirmation that transaction cannot be changed, reversed or double spent.

A transaction with 1 confirmation can be reversed in a way. 6 confimation is considered to be safe. Don’t worry too much about it now. You will learn more about this later.

[azu]

1. Once a transaction was made, it’s not modifiable.
2. Made system, network, and protocol trustable.

[Mauro]

@Emmett

it doesn’t matter - no trust is needed. The network handles trust for you.

In fact, you can verify it yourself. Don’t trust, verify.

[Gabriel]

1. What do we mean when we say that blockchain has transaction finality/immutability?

Finality means that you can’t take it back. When you send bitcoin “it is physically impossible” to get it back.

2. How does this lead to the trustless environment that blockchain creates?

Finality allows for confidence in the transaction process, once you send something, you can’t take it back. We trust the system we do not need to trust the sender.

[Mauro]

Maybe. Its quite hard to say. Right now with bitcoin, once you send out a transaction there will be a miner picking it up ASAP. As he wants to make money from your fees. Maybe some kind of double approval from both sides could be intoduced as we move on. Great question

[investGeek]

Simply put, “All sales are final!” lol and since this is the case it creates trust in the fact that you don’t have to trust someone after a transaction has been added to a block in the chain it will be there FOREVER.

[adamsmithuk]

1. What do we mean when we say that blockchain has transaction finality/immutability?
   ONCE A TRANSACTION IS completed by the sender there is NO way it can be reversed or changed/modified by the network, it will not allow any reversals from the original command, this is obviously not to say the receiver cannot decide to return funds to the said sender; but that would be another transaction with (again) finality.
2. How does this lead to the trust-less environment that blockchain creates?
   Party A sends at their wish of funds to Party B seamlessly and non compromised, this in its definition and action = a trust less transfer

[jrix]

1. It means that when a transaction has been sent it is final, you can not get it back or cancel.
2. Thanks to consensus, everybody plays by the rules that are settled.

[Gss147]

Blockchain is final because all transactions are non-reversible. Through mining and proof of work, blockchain creates a trustless environment because it verifies all transactions.

[Mengxiong1024]

1. Once a transaction is made and confirmed, it cannot be reversed.
2. This leads to the trustless environment that the blockchain creates because it cannot be reversed. If I sell something, and I receive bitcoin as a payment, I know I got my money.

[0xMac]

1. It cannot be reverse once network reached consensus of the truth.
2. It cannot be redrawn by the sender. For change of historical data all nodes must agree of the change and that is close to impossible.
   This could be useful in transactions of value or data when you don’t want to rely on trust of the other party. You only need to put your trust into the protocol of the network. And the network has a good track record of keeping the trust on top.

[angela]

1. Once a transaction has been posted to the blockchain, it is final, complete, and will persist forever.
2. We trust not necessarily in each other, but collectively in the network itself built on math and protocol. Since transactions have finality, we know they cannot be edited, updated, or removed/deleted. So, we can be confident in doing business with strangers as we know transactions completed are true and final.

[Paddy]

What do we mean when we say that blockchain has transaction finality/immutability?
Once a transaction is sent and confirmed it cannot be recalled – this creates a level of trust above what is currently in place in the financial space (i.e. charge backs on payments).

How does this lead to the trustless environment that blockchain creates?
It can be verified mathematically that once a transaction is confirmed, this in turn creates a trustless environment.

[wafflemakr]

Hi there!! So how does this help to create a trustless envirnonment? Can you think of any cases where this is really important?