Quote from: jonnybravo0311 on May 15, 2015, 08:00:07 PM

Quote from: rasgbonyo on May 15, 2015, 07:23:02 PM

I see. So that transaction fee is added on to a block which contains 25 Bitcoins already to make it 25.95 BTC. So unless that block is mined your transaction is not "approved" ?

Sort of... let me try to explain it a bit more clearly.

People are constantly creating transactions to move coins around. These transactions contain inputs and outputs. The inputs are what you as the sender are combining together to come up with the desired amount of coin you wish to send. The outputs are the receiver(s) of those coins and change addresses. The difference between the inputs and the outputs are the fees.

Using my example above, I had two inputs, each of 1BTC and only one output for 1.05BTC. Because there was 0.95BTC leftover, that becomes what we refer to as the fee.

Now, pools - and individual miners if they're going at it solo - are taking some number of those transactions, and attempting to find a hash that satisfies the network difficulty, so that those transactions can be added to the public ledger known as the blockchain. When a miner is successful in doing so, a new block is created and added to the chain. The reward for creating that new block is the generation of 25 brand new coins. Additionally, because there is a difference between the inputs and outputs (in our example, 0.95BTC), that is also awarded as part of that transaction which creates the 25BTC. So, assuming our transaction was the only one included in a block, the end result you would see by looking at the blockchain is a block with TWO transactions. The first transaction is the 25.95BTC of generated coins, the second is our transaction sending 1.05BTC.

There really is no "approval" here, but rather "confirmation". Your transaction, once it gets included into a block becomes confirmed. Those 25.95BTC are referred to as generated coins and you must wait 101 confirmations before they become spendable coin.

Make sense?

Yep.