All public blockchains are based on the concept of blockchain confirmations. Knowing what they are for and knowing the reason for their existence is essential to understand what the blockchain is and on what principles it is based.
When transferring bitcoins from one wallet to another, the transaction has zero confirmations initially. This number increases when the information is added to the first block and confirmed.
These confirmations are vital in that they allow the verification and legitimisation of information that will become immutable. If a transaction is considered fraudulent, it will not be approved. Zero confirmations mean that the transaction is not yet valid but is being processed.
The number of confirmations required often rises as the amount increases and varies according to the cryptocurrency being transferred.
Blockchain Confirmations: Bitcoin
As far as Bitcoin is concerned, some services are flexible and are satisfied with a couple of confirmations, others want 3, while some others want at least 6. On average, exchanges require a minimum of three confirmations before they can accredit the amount of a transaction.
Coinbase, for example, does not consider a bitcoin transaction finalised if it has not received at least 6 confirmations. The more confirmations there are, the harder it is to reverse the transaction. For a transaction of $1 million, at least 60 confirmations may be required.
The Bitcoin blockchain produces a new block every 10 minutes (on average) using the mining process. All new transactions are inserted in the block and become an integral part of the blockchain. A transaction is therefore unconfirmed until a new block is generated. That’s why if you’re waiting for a certain amount it’s essential to wait for the transaction to be confirmed.
For a large transaction (60 confirmations) the waiting time will be 600 minutes, a total of 10 hours.
The so-called Bitcoin mempool is the ocean of transactions awaiting confirmation in the Bitcoin network. Once you transfer a certain amount of BTC the transaction is not confirmed immediately but becomes part of the mempool.
All nodes in the Bitcoin network are connected to the mempool. The miner who solves a block and adds it to the blockchain is the one who gets the BTC reward.
Some transactions are processed more quickly than others because the miners receive a percentage for the work done (fee) and thus process first the transactions that guarantee them the highest revenue. The higher the fees you pay for confirming a transaction, the sooner it will be processed. If the associated fees are very low the transaction could remain unconfirmed forever.
Currently there are about 70,000 unconfirmed transactions, obviously this number changes continuously.
As far as Ethereum is concerned, things get more complicated. According to the whitepaper, there are 7 confirmations needed for a transaction and it takes, on average, a couple of minutes.
The Ethereum miners have to control the parameters of about 250 blocks. Therefore, for maximum safety, it is necessary to wait for 250 confirmations. It sounds like a lot, but it actually takes about an hour.
Coinbase requires 35 blockchain confirmations before considering a transaction successfully completed. In the future, Ethereum should switch to the Proof of Stake which will make transactions even faster.
Etherscan and Ether Gas
The Ethereum mempool is simply called a transaction pool and contains all transactions that have not yet been placed in a block.
To speed up a transaction it is necessary to increase the GAS (fees). The Ethereum network currently has over 30,000 unconfirmed transactions.