Friday , November 16 2018
Home / Bitcoin - BTC / How is a Bitcoin transaction handled?

How is a Bitcoin transaction handled?

Pay to Script hash (also known as P2SH) is a multi-level conceptual extension that can reduce the burden on the Bitcoin storage infrastructure.

How is a Bitcoin transaction handled
How is a Bitcoin transaction handled?

Pay to script hash (P2SH) transactions were standardised in BIP 16. This computing allows transactions to be sent to a script hash (address starting with 3) instead of a public key hash (addresses starting with 1). Receivers have to submit a script matching the script hash and data making the script evaluate to true, in order to get the bitcoins sent by P2SH.

With P2SH, you can send bitcoins to an address that is secured in various unusual ways without knowing anything about the details of how the security is set up. You just send bitcoins to the nearly 34-character P2SH address. The receivers may be in need of signatures signing by several people to earn these bitcoins, or a password may be required, or the requirements could be completely unique.

This method can simplify the encryption process, and transfer the burden of fees from the sender to the receiver.

You should have a look at the following picture to get a better idea of the Bitcoin transaction.


The P2SH transaction structure must be handled carefully because the error can cause the transaction to fail. Another important point is that the details of the transactional script are not stored in the blockchain, only the hash, and thus the creator of the transaction must keep a copy of the script or remember the route to generate the specific hash tool.

Rate this post

Check Also

This is a Bitcoin miner system

A close look at superior Bitcoin miners

Let’s take a close look at superior Bitcoin miners, which is also called as BitcoinBuffalo. …

Leave a Reply

Your email address will not be published. Required fields are marked *