Transparency is an important concept in cryptocurrencies. One of the great promises of blockchain is that it levels the playing field by not limiting information to a privileged few in a position of control. But what is the exact meaning? Can you find out how many bitcoins your neighbor owns? How can you see and verify public data yourself? That is what we discuss in this article. Note that we focus on Bitcoin. However, you can also find dedicated blockchain explorer for Ethereum, Litecoin, and pretty much any native blockchain.
Introduction
Have you ever missed a payment or someone swore they didn’t pay you? In our current financial system, this may be a “he said, she says” situation or it may require third party intervention.
Blockchains solve this problem by introducing the concept of public transparency, where information is available to be viewed by anyone at any time. For blockchains like Bitcoin and Ethereum, all information is publicly visible by design, which is useful when transactions (or Tx) and contracts need to be easily identified and verified.
In this tutorial, we will look at the basic layout of the Bitcoin block explorer. We will then look at a well-known transaction that led up to Bitcoin Pizza Day on May 22.
What is a Blockchain Explorer?
The blockchain explorer is like a search engine that reveals information about the past and present state of a blockchain. This can be useful when you want to track the progress of a particular payment or check the balance and history of an address. Anyone with an Internet connection can use the explorer to view all the transactions of a public blockchain.
How does a Blockchain Explorer work?
Every blockchain will have a Command Line Interface (CLI) to interact with the database and view the history of the network. However, the CLI explorer is not a user-friendly experience for the general public. That’s why most blockchains will also have an explorer with a Graphical User Interface (GUI) that will display information in a more user-friendly format.
Let’s explore one of the commonly used Bitcoin explorers: blockchain.com. Other alternatives to BTC include blockchair.com and blockcypher.com.
You can see some high-level data about the Bitcoin blockchain on the front page. This includes price, estimated hash rate, daily transaction count, and transaction volume. We also see a mempool size and price mappi
ng chart. At the bottom we can keep track of the latest blocks and transactions.
Let’s go over what we can see here in more detail:
- Price: A aggregated USD price feed across several markets. In most cases, the price depends on the feed supplier and not the spot price on a particular exchange.
- Estimated Hash Rate: An estimate of the computing power currently used by miners to secure the blockchain. It can be seen as a proxy for the security of the Proof of Work (PoW) blockchain.
- Transactions: The number of unique transactions confirmed in the last 24 hours. To be confirmed, a transaction needs to be included in a validated block (a block that has been successfully mined).
- Transaction Volume: A measure of the total output value (in BTC) confirmed on the blockchain over the last 24 hours. Because of the way Bitcoin works, this total also includes unused outputs that are returned to the “spent” wallet on change.
- Transaction Volume (estimated): Estimated (in BTC) actual transaction volume transferred between unique wallets. That’s Transaction Volume (above) minus an estimate of the output returned when changing spend wallets.
- Mempool Size: The size mempool keeps track of the overall size (in bytes) of transactions waiting to be included in a block. It is a proxy for the amount of activity on the blockchain and can serve as an indicator of the fees required for fast confirmation.
- Latest Blocks: List of confirmed blocks, from newest to oldest. It includes details like block height, timestamp, miner name (if known), and block size. You can click on “block height” to discover information about the transactions included in the block. Clicking on “miner” will reveal information about the address of the block miner. The miner’s public address can be a known mining pool address. If you don’t know what a mining pool is, check out this article.
- Latest Transactions: List of valid transactions that have been sent to the mempool. Again, transactions are not confirmed until they are included in a validated block.
There are additional blockchain metrics you can track on this page, including network difficulty, fee per transaction, and average confirmation time. Some blockchain explorers will also allow you to connect to their API.
How to view 10,000 bitcoin pizza transaction
Pizza Day is an auspicious day in Bitcoin history that celebrates the purchase of two large pizzas in exchange for 10,000 bitcoins. Using our block explorer, we were able to view and explore the details of this famous transaction.
Pizza day transaction hash:
a1075db55d416d3ca199f55b6084e2115b9345e16c5cf302fc80e9d5fbf5d48d
Copying the transaction hash into the search field of the Bitcoin blockchain explorer will bring us to the Pizza Day transaction. If you don’t want to copy-paste the details, here’s a link to the deals page.
At the top of the page, you can see a summary of the transaction’s inputs and outputs. On the left is the bitcoin paid for the pizza (total 10,000 BTC). They were sent to a single address on the right (belonging to the pizza delivery person).
If you click on the receiving address (on the right), you will see its transaction history. You can also scan the QR code to get the corresponding address string. QR codes are useful when paying with TrustWallet or other mobile crypto wallets.
If you return to the original Pizza Day deals page, you can scroll down to check the transaction details. These include the unique hash for the transaction, confirmation status, timestamp, number of confirmations, total input and output, mining fees, and more. You can see a transaction fee of 0.99 BTC paid to miners over 10,000 BTC for pizza.
Clicking on the block height ( 57,043 ) will give you details about the block this transaction is included in.
As you can see, the Pizza Day transaction confirmation block is a volatile block. There are a total of two transactions, one is the Pizza Day transaction and the other is the miner’s block reward.
The green and red spheres on the right side indicate whether bitcoins have been spent or not after this transaction. The pizzeria sent that 10,000 BTC to another address, but the miner’s address still holds the block reward (50.99 BTC).
Closing thoughts
A blockchain explorer is a useful tool that exploits the open and transparent nature of public blockchains. They provide useful information about the state of the network, including transaction history and addresses, allowing for easy verification and tracking.
However, this emphasis on full public transparency can lead to historical mapping of transactions and addresses known as chain analysis. This can expose the pseudo-addresses nature, especially for users who tend to use the same address more than once (not recommended). Other public blockchains (such as Monero) strike another balance between transparency and privacy.
Now that you have a rough understanding of how blockchain explorers work, let’s play around with them yourself. The secrets you discover, it may surprise you!