How Blockchain Transactions Work
Kuma from KIRAPAY
Sending crypto looks simple from a user's perspective: enter an address, enter an amount, confirm. But between the moment you tap 'send' and the moment funds arrive, a sophisticated sequence of events unfolds across a global network. This article explains exactly what happens.
The 6 Stages of a Blockchain Transaction
Step 1 — Sign & Broadcast:
Your wallet uses your private key to digitally sign the transaction — cryptographic proof that you authorised it. The signed transaction is then broadcast to the network. Status: Pending.
Step 2 — Network Propagation:
The transaction spreads across thousands of nodes worldwide within seconds. Each node independently verifies: Does the sender have sufficient funds? Is the signature valid? Is this a duplicate of an already-submitted transaction?
Step 3 — Mempool Queuing:
Verified transactions enter the mempool — a waiting room of pending transactions. Transactions with higher gas fees are typically selected for inclusion first, which is why paying slightly more gas speeds up confirmation during busy periods.
Step 4 — Block Formation:
A validator (miner on Proof-of-Work chains, staker on Proof-of-Stake chains) selects transactions from the mempool, verifies them, and assembles them into a candidate block.
Step 5 — Block Confirmation:
The validator proposes the new block to the network. Other nodes verify the block's contents and the validator's legitimacy. Once the network reaches consensus, the block is accepted — your transaction now has 1 confirmation.
Step 6 — Finality:
Each new block added after yours counts as an additional confirmation. Most use cases consider a payment final after 1–6 confirmations depending on the network and the transaction value. Once final, the transaction is permanently and irreversibly settled.
The Registered Letter Analogy
Think of it like sending a registered letter: handing it over is broadcasting, the postal system logging it is node validation, loading it on the truck is block formation, the truck departing is block confirmation, and delivery with signature is finality. At that point neither sender nor postal service can retrieve it.
Transaction Speed by Network
Network | Consensus | Avg Block Time | Practical Finality | Typical Gas Cost |
|---|---|---|---|---|
Solana | PoS | ~400ms | Under 1 second | < $0.001 |
Base | PoS | ~2 seconds | Under 30 seconds | < $0.01 |
Polygon | PoS | ~2 seconds | Under 30 seconds | < $0.01 |
Arbitrum | PoS | ~2 seconds | ~1 minute | < $0.05 |
Avalanche | PoS | ~2 seconds | ~3 seconds | < $0.10 |
BSC | PoS | ~3 seconds | ~15 seconds | < $0.10 |
Ethereum | PoS | ~12 seconds | ~2 minutes | $0.50–$5+ |
Bitcoin | PoW | ~10 minutes | ~60 minutes | $1–$20+ |
What Can Go Wrong
Issue | Cause | What Happens |
|---|---|---|
Transaction stuck pending | Gas fee set too low for current network congestion | Sits in the mempool until congestion clears, or is eventually dropped |
Transaction failed | Ran out of gas mid-execution, or the smart contract condition was not met | Gas fee is still consumed — the payment amount is not charged, but the gas is lost |
Sent to wrong network | Customer sent ETH on Ethereum when merchant expects Polygon | Funds exist on-chain but cannot be accessed at the destination address without technical recovery steps |
Sent to wrong address | Typed or pasted address incorrectly | Permanently lost — blockchain has no reversal mechanism and no customer support line |
✅ KIRAPAY Prevents Network Mismatch KIRAPAY's checkout handles network routing automatically. Customers never need to manually specify which chain they're paying on — the cross-chain system routes the transaction to your configured settlement chain regardless of where the customer pays from.
