Homework on Finality - Questions

  1. Because every transaction is irreversibly added to the next block, it cannot be removed. Once a transaction happened, it cannot be undone or changed.

  2. Because of this immutability everything that happens is final. That means one person can trust the network that the another person can’t revoke a transaction. The consesus algorithm makes it physically impossible to be fraudulent on the blockchain. That means interaction/transaction can happen without having to trust the other person.

  1. Once a transaction is confirmed, it cannot be withdrawn or changed.
  2. Strangers can do business with each other without fear of fraud.

I do not fully understand how blockchain finality relates to the real world. The transaction is immutable, but doesn’t that simply mean that the client on the receiving end can be screwed over? Payment is final, but how is the product received for such payment final? Isn’t it the word of the the recipient vs the word of the company/person offering the product? What if the product is never received? What is the proof that it was or was not received?

It means that if you make a payment, you know the payment is made and is immutable. If there would be a problem with the delivery, you can always get your money back with a new transaction.
Witch credit cards, there is always a risk that a payment got canceled somehow. If the vendor already shipped the product, the customer gets it for free.
Having 100% proof on the blockchain that a certain payment is made and is immutable is Huge.

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  1. Means nobody can reveres or change a transaction happened.

  2. Because once you get paid scammers cant cancel the transaction!

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  1. It allows for a valid transaction to take place, you have the currency needed to
    complete the transaction, you send the currency the transaction is complete and
    cannot be changed or reversed.

  2. We know that the decentralized network came to consensus on a particular
    transaction and confirmed it within a mined block that became part of
    the blockchain.

  1. transactions once verified by the network are complete and irreversible.
  2. i don’t have to rel on anyone to determine validity of transactions i make.

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

A transaction, once confirmed, can not be changed or reversed. It is FINAL.

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

The trust is in the network, in the math and not a person. It is the same for everyone.

  1. Transaction finality means there is no way to alter the transaction once it has been executed and finalised.

  2. The immutability/finality protocol feature will ensure that the blockchain’s trustless environment is upheld.

  1. When transaction is confirmed by consensus it can’t be reversed. It is stored on blockchain and cryptographically connected with all previous and future transaction and therefore is immutable.

  2. You can reliably transact with strangers by verifying all transactions on public ledger. They also don’t have an option to cancel their transaction or ask for chargebacks; transactions are irreversible.

1. What do we mean when we say that blockchain has transaction finality/immutability?
Once the transaction is complete it can not be undone. The transaction remains written within the blockchain forever (Viking Stone).

2. How does this lead to the trustless environment that blockchain creates?
Allows business to be conducted between strangers and across boarders because the completed transaction is mathematically and independently validated which can not be undone through a mining process call “Proof of Stake”.

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

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

  3. It means that once a transaction goes through it can never be reversed or copied,.

  4. We no longer have to trust or know the person we are dealing with as far as receiving a payment. Because once the payment is sent the transaction is final.

  • What do we mean when we say that blockchain has transaction finality/immutability?
    Transactions can’t be reversed, when confirmed.
  • How does this lead to the trustless environment that blockchain creates?
    There is no risk of chargebacks.
  1. because when a transaction has been made it is finale and cannot be undone.
    2.it creates a trustless environment because everyone can verify what transactions have been made not allowing anyone to reverse a transaction
  1. Once a transaction is confirmed it’s integrated in the blockchain. No changes possible. And new blocks are build on top of the previous one.
  2. Thus we trust maths. The consensus determines the truth, no need to know and trust an other party. We follow a protocol
  1. What do we mean when we say that blockchain has transaction finality/immutability?
    Once a transaction is recorded to the blockchain it can’t be removed. The transaction is irreversible and there for everyone to see.
  2. How does this lead to the trustless environment that blockchain creates?
    It creates a sens of trust between two party that don’t know each other. For example if you get paid in cash from an non trust-able source, that cash might be counterfeit. On bitcoin once A send funds to B and it is confirmed on the blockchain, B knows for sure that he now controls those funds and they are spendable and valid.
  1. It basically means that once a transaction has happened in the blockchain, there is no way to reverse it. This is because of each block in the blockchain is defined by a hash, that is defined by all the transactions in the block. Also, each block references the hash of the previous block, meaning that, if you change a transaction in an old block, the block the transaction is in will have a new hash value that no blocks are pointing at, making the whole blockchain invalid. This is what Ivan means when he says it’s “mathematically impossible” to remove/change an existing transaction.

  2. You don’t need trust, because you can verify it. It’s like when a friend tells you 2+2 is 4. You don’t need to trust him, you can just count it yourself. That’s the same principle regarding blockchain and verifying transactions; you don’t need to trust that a stranger has 1000 BTC etc. You can just sum up his/her transactions in the blockchain.

Once consensus is achieved the transaction is locked in the chain and cannot be reviersed or changed = finality/immutability.
I do not need to trust the vendor / customer for a transaction because once the chain verifies it it becomes fixed.

1 Significa dizer que assim que uma transação for confirmada, jamais poderá ser revertida, a não ser que a blockchain sofra um ataque.

2 Devido à imutabilidade da blockchain os usuários da rede podem confiar que suas transações são seguras e confiáveis, devido às propriedades imutáveis da blockchain.

  1. It means transactions cannot be reversed or charged back. Every transaction on a blockchain will be there for all time.

  2. It is a trustless environment because you are able to do business with people you don’t know without any worry they will scam you.