Sending Bitcoin looks simple from the user's perspective: enter an address, enter an amount, press send. Behind that simple interface is a sequence of cryptographic operations, network communications, and consensus processes that is considerably more involved - and considerably more secure - than any traditional bank transfer. Understanding what actually happens when you send Bitcoin is not just intellectually satisfying - it explains why transactions are irreversible, why confirmations matter, why fees work the way they do, and why certain mistakes are catastrophic. This lesson walks through the full process.
From Send to Confirmed
When you press send in a Bitcoin wallet, the wallet constructs a transaction containing: the address you are sending from, the address you are sending to, the amount, the transaction fee, and a digital signature - created using your private key - that proves you authorise this specific transaction.
This transaction is broadcast to the Bitcoin network - initially to a few nodes your wallet is connected to, which then relay it to their neighbours, and so on, until the transaction has propagated to the entire network within seconds. It now sits in the mempool: the pool of valid but unconfirmed transactions waiting to be included in a block.
The Mempool
The mempool is where transactions wait. Every full node on the Bitcoin network maintains its own mempool - a collection of valid transactions that have not yet been confirmed in a block. When a miner builds the next block, it selects transactions from the mempool - typically prioritising those with the highest fees per byte of data.
During periods of high network activity, the mempool can become congested - hundreds of thousands of transactions waiting, with fees rising as users compete to have their transactions included in the next block. During quiet periods, even transactions with minimal fees confirm quickly.
Transaction Fees
Bitcoin transaction fees are not a fixed amount - they are determined by supply and demand for block space. A Bitcoin block has a maximum size (approximately 1-4 MB depending on the transaction types). If more transactions are waiting than fit in a block, users who pay more per byte of data get included first.
• Typical transaction size: 250 bytes.
• Moderate fee rate: 20 satoshis per byte.
• Total fee calculation: 250 × 20 = 5,000 satoshis (0.00005 BTC).
• At a $60,000 BTC price: approximately $3.00.
During network congestion, fee rates may rise to 100-500+ sat/byte ($15-$75+ total). In quiet periods, rates may fall to 1-5 sat/byte ($0.15-$0.75 total). Major wallets show the current environment and recommend appropriate rates.
Confirmations and Finality
Once a miner includes your transaction in a block and that block is added to the blockchain, your transaction has one confirmation. Each subsequent block added to the chain adds another confirmation. The more confirmations a transaction has, the more computationally expensive it would be to reverse it - because reversing it would require recalculating every subsequent block.
Six confirmations - approximately one hour - is the widely accepted standard for considering a transaction final for most purposes. For large transactions, some parties wait for more. For small, everyday transactions, even one or two confirmations is typically sufficient.
Common Transaction Mistakes
1. Sending to the wrong address: Irreversible. Always copy-paste and verify first/last 4 characters.
2. Sending to the wrong network: e.g., sending BTC to an ETH address can result in permanent loss.
3. Setting fees too low: Stuck transaction for days during high congestion. (Some wallets support fee-bumping via Replace-By-Fee).
4. Not accounting for change: Bitcoin uses the UTXO model. The remaining balance after a transaction returns automatically as 'change UTXO' to your own wallet.