How does a Bitcoin transaction work?
From tap to confirmed

What you see vs. what happens

From your perspective as a merchant, a Bitcoin payment looks simple: a customer scans a QR code, you see a confirmation, the money arrives. Clean and fast.

Behind that simplicity is a chain of events involving your customer's wallet, a global peer-to-peer network, and the immutable ledger we call the blockchain. Understanding the steps helps you answer customer questions, troubleshoot slow confirmations, and explain to skeptical staff why the payment is real.

Step 1: The payment request

When you open OrangeTill and enter a dollar amount, the app generates a payment request — a QR code that contains your wallet address, the amount requested (in both dollars and the chosen cryptocurrency), and a short expiration window.

Your customer's wallet app reads this QR code and prepopulates everything: address, amount, network. The customer just taps "confirm."

Step 2: Transaction creation and signing

When the customer confirms, their wallet does several things automatically:

1. It creates a transaction object — a structured piece of data containing: sender address, recipient address (yours), amount, network fee, and timestamp.
2. It signs the transaction using the customer's private key — creating a unique cryptographic signature that proves they authorized this specific payment without revealing their key.
3. It broadcasts the signed transaction to the network.

This entire process happens in under a second, invisibly, the moment the customer taps confirm.

Step 3: Propagation across the network

The signed transaction is broadcast to the peer-to-peer network — thousands of computers (nodes) that each receive it and add it to their mempool: a holding area for transactions waiting to be included in the next block.

Each node validates the transaction independently: Does this address have enough funds? Is the signature valid? Has this exact transaction been submitted before? If all checks pass, the node passes it along to its peers.

Within seconds, the transaction has reached nodes across the globe.

Step 4: Mining (or validation) and confirmation

For Bitcoin: miners compete to collect a batch of pending transactions, solve a proof-of-work puzzle, and add the winning block to the chain. The first confirmation happens when your transaction is included in a mined block — typically within 10 minutes. Merchants usually wait for 1–3 confirmations for small purchases, 6 for large ones.

For USDC on Solana: validators confirm transactions in about 400 milliseconds — under half a second. The consensus mechanism is different (proof of history + proof of stake), and the block times are radically faster. For everyday merchant payments, this is effectively instant.

For USDC on Ethereum: blocks are added roughly every 12 seconds, and most wallets consider a transaction final after 12–64 blocks (~2–13 minutes).

Step 5: Settlement to your wallet

Once confirmed, the funds are in your wallet. Not pending. Not held. Yours — recorded permanently on the blockchain, verifiable by anyone, reversible by nobody.

OrangeTill polls for incoming transactions and updates your payment history as confirmations arrive. You'll see the status move from "pending" to "confirmed" and the dollar equivalent recorded in your transaction log.

What can go wrong — and what to do

Transaction stuck in mempool: The customer's wallet set a fee too low. For Bitcoin, this can mean waiting hours during busy periods. Most modern wallets (and OrangeTill's payment requests) set fees appropriately, but it occasionally happens. The transaction will eventually confirm or be dropped after ~72 hours with no cost to either party.

Sent to wrong address: Bitcoin transactions are irreversible. If a customer sends to the wrong address — especially a different chain — recovery is usually impossible. QR codes eliminate this risk by pre-filling the address automatically. Always use QR codes rather than manual address entry.

Wrong network: Sending USDC from an Ethereum wallet to a Solana address (or vice versa) can result in lost funds. Most wallets now warn about network mismatches, and OrangeTill's QR codes specify the network. This is increasingly rare as wallets get smarter.