Bitcoin: How to Verify a Bitcoin Transaction

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Validating Bitcoin Transactions in Bitcoin Core: A Step-by-Step Guide

Congratulations on installing Bitcoin Core, the official reference implementation of the Bitcoin protocol! Since you’re running a full node, you’re now one step closer to understanding how Bitcoin works. A crucial aspect of Bitcoin is transaction validation, which ensures that each block contains valid transactions and does not contain double spending or other malicious activity.

In this article, we’ll walk you through the process of validating a Bitcoin transaction using Bitcoin Core.

What does it mean to validate a transaction?

When you send a transaction, your node must check if it’s valid. This involves checking several conditions:

• Transaction validity: Does the transaction contain all required fields (e.g., sender, recipient, amount)?

• Transaction sequence: Is the transaction in the correct order?

• Amount and denominations

  : Are the amounts and denominations correct?

Step-by-step guide to validating a Bitcoin transaction

• Connect to your node: Use bitcoin-cli or a GUI client like Electrum to connect to your full node.

• List all blocks: Run the getbalance() command, which returns a list of unconfirmed blocks. This will give you an idea of ​​​​what transactions are pending.

• Find the transaction you want to validate: Use gettransaction() with the transaction ID (txid) or hash of the transaction. You can find this by listing all blocks and looking for the txid or hash.

• **Use getrawtransaction(): This function returns the raw transaction data, which is a JSON file containing all the transactions in the block. To access the transaction data, you will need to use getblocktemplate() to create a block template, then use getrawtransaction() with that template.

• Check transaction validity: You can validate each transaction individually by checking its fields using tools like bcpairs(). This command lists all the value pairs in the transaction.

• Check sequence order (optional): If you are concerned about transaction sequences, you can use gettransaction() with a specific txid or hash and then check if it is in the correct sequence using getrawtransaction().

Example use case

Let’s say you want to validate a transaction that sends $100 from your Coldcard Wallet to another user’s address (User A).

• Connect to node: Run bitcoin-cli getbalance().

• Find transaction: Look up the transaction’s txid or use gettransaction() with a specific hash.

• Use bcpairs() to validate individual transactions:

bitcoin-cli bcpairs -txn  | grep 'value'

This will show you all the value pairs in the transaction.

• Check the sequence order (optional):

• Use gettransaction() with a specific txid or hash.

• Check if you are in the correct sequence using getrawtransaction(). For example:

bitcoin-cli getblocktemplate | bcpairs -txn  | grep 'seq'

Tips and variations

• Use the bcl command-line tool to validate transactions. It provides a more structured way to check transaction validity.

• If you are using Electrum, you can use its built-in transaction validation tools to simplify the process.

By following these steps and tips, you will be able to validate Bitcoin transactions with Bitcoin Core. Remember that this is just one aspect of Bitcoin’s security features; it is essential to keep your node up to date with the latest protocol updates to stay safe.