Homework on Finality - Questions

Blockchain and Bitcoin 101
#1730

1.) That it is irreversable. it cannot be rolled back.

2.) Dont trust, Verify

1 Like
#1731

  1. It means that it cannot be reversed when sent to the blockchain.

  2. By making people trust the system and not the person, who could potentially scam you.

1 Like
#1732

  1. Transactions cannot be reversed or changed.

  2. In finality trust is eliminated and all transactions are confirmed by the network.

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#1733
  1. Once a transaction is complete, it can not be reversed
  2. Once complete, the transaction is the verification
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#1734
  • What do we mean when we say that blockchain has transaction finality/immutability?

Once a transaction has passed / has been verified, it cannot be canceled or taken back.

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

It is not necessary to trust the counterparty, all transactions are public and verifiable. The trust is put in the protocol and not the players involved.

1 Like
#1735
  • What do we mean when we say that blockchain has transaction finality/immutability?
    It refers to a concept that means once a transaction has been performed or sent it cannot be reversed or renigged under any circumstances.
  • How does this lead to the trustless environment that blockchain creates?
    Allowing for such a finalaty or immutable concept gives assurance to both buyser and sellers that an item contracted for has been performed and paid for without any chance of reversing which may be due to fraud.
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#1736

What do we mean when we say that blockchain has transaction finality/immutability?
Once the transaction is made, it can never be reversed for all times.

How does this lead to the trustless environment that blockchain creates?
This removes trust because everyone knows the transaction are final. There is no way to do a charge-back. There is no way to do a scam

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#1737
  1. Once a transaction has been sent you can’t reverse it
  2. Anyone can verify a transaction so you can do business with strangers. The transaction can’t be changed.
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#1738

  1. Because info can be added but not erased, each block is like a linked list with a pointer to the previous hash so history can not be modified.

  2. Because you can’t rewrite the past so the immutable character of the blockchain data structure ensures that data hasn’t been tampered with, making trust a free side effect

1 Like
#1739

What do we mean when we say that a blockchain has transaction finality … immutability.

transactions cannot be altered, reversed, or cancelled after they are completed. … So, when it comes to blockchain technology, transactions are termed immutable due to its finality nature.

How does this lead to the trustless environment that blockchain creates?
It doesn’t remove trust completely just we are trusting the math and methods dealing with consensus, cryptography, and incentivising successfully, so that we can transact safely in minimal trust environments.

1 Like
#1740
  1. On a public blockchain you can not change a transaction after it happened, because of physics and mathematics.
  2. After the transaction happened and confirmed several times I can trust the fact that it happened, so I can trust the network, so I do not need to trust strangers.
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#1741

Yes. But please be aware that new scams come out of this. A great example of a new scam is fake giveaways. They want you to send them some cryptocurrencies with a promise that you will be returned double of what you sent. Once you do send a transaction, they will never send anything back. They know you can’t take it back, so they “run away” with it. Everything is FINAL. :wink:

3 Likes
#1742
  1. Finality means that once a transaction has been posted to blockchain, it cannot be reversed. Unlike traditional banking where it is envisaged that a transaction may be cancelled in certain circumstances, with the parties to be restored to their original position, there is simply no mechanism available to do so within the blockchain technology because of the use of mining and a proof of work.
  2. Any reversal of a transaction will depend on the affected party’s indication that something has gone wrong with the original transaction. The process relies on trust between the parties concerned and in theory is open to abuse. Any need for trust between the parties is redundant once there is no physical way back after a transaction has been posted to blockchain. Therefore, the parties, who are unknown to each other, may have mutual dealings in full confidence that there is no foul play or hidden agenda involved on part of anyone.
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#1743

In the traditional financial system, there are avenues in place to get a customer’s money back (in some cases) from bad actors like PayPal’s Resolution Center or a bank’s chargeback policy. However, financial transactions with cryptocurrencies are immutable or final. So, once you send X amount of BTC, ETH, etc. to another’s public address that’s it. There’s no intermediary for you to call to help you get your money back. Buying, selling, and trading cryptocurrencies has an added layer of responsibility because there are no middlemen. You are your own bank, as they say…

A blockchain’s immutability leads to a trustless environment by making transactions public and unbiased. E-commerce tends to favor the buyer and not the seller. Depending on the item, buyers can request a refund and keep the product.

Sidenote: Correct me if I’m wrong, but immutable transactions became a part of the Bitcoin protocol to eliminate double spending, a flaw in pre-bitcoin digital currencies.

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#1744

Yeah, I see those scams are all over YouTube. “Kylie Jenner is giving away 5000 BTC” :rofl:

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#1745

Exactly. Since you can’t reverse the transaction, you can’t double spend. Great observation. :smiley:

3 Likes
#1746

That’s it. We must educate as much people as we can. When you learn that transactions are final, you will think twice before actually sending money to a random person on the interent. :wink:

3 Likes
#1747

  1. What you mean is that once a transaction happens, there is no way to edit or change it.

  2. This eliminates the need to trust people because transactions cant be changed. Currently, if a customer bought something from a website, they can have their bank take back that money and scam the site. Because of this websites need to ‘trust’ that their customers won’t steal their money back. Since every transaction is final on blockchain, customers cant take that money back.

1 Like
#1748

The data is posted on the blockchain and cannot be edited or deleted. It is final and can only be appended on a later block.

The basis of the contract is for each party to perform what is agreed upon and for the system to verify. The verification must be finalized for each party in order to execute.

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#1749

  1. it means that once the transaction has been confirmed and written on the ledger, there is no going back

  2. This means that you can trust the system that people can not cancel/duplicate a payment once it has been started unlike the current financial system where customers are taking advantage of retailers and cancelling payment once the good has been purchased,

1 Like