CREATE TRANSACTION: Alice opens her Bitcoin wallet to access her UTXOs. She creates a new transaction and uses her private key to sign it, proving ownership of the funds.

INPUT RECIPIENT'S ADDRESS: Alice enters Bob’s Bitcoin address, which is derived from his public key, ensuring the transaction is sent to the correct destination.

DEFINE AMOUNT & FEE: Alice sets the amount to send (1 BTC) and selects a miner fee, incentivizing miners to prioritize her transaction for faster inclusion in the blockchain.

SIGN WITH PRIVATE KEY: Alice’s wallet uses her private key to sign the transaction, proving ownership of the inputs and authorizing the transfer without revealing her private key.

BROADCAST TRANSACTION: The signed transaction is broadcast to the Bitcoin network and enters the mempool, where it awaits inclusion in a valid block by miners.

MEMPOOL VALIDATION: The transaction sits in the mempool across full nodes, waiting for a miner to include it in a valid block.

MINER SELECTS TX: A miner selects the transaction by fee priority and adds it to a candidate block being built for Proof-of-Work.

BLOCK FOUND POW: A valid Proof-of-Work is found, and the block is mined. Alice’s transaction becomes part of the blockchain and is considered confirmed.

BLOCK BROADCAST: The block is propagated across the Bitcoin network. Each node independently verifies it and, if valid, adds it to its local copy of the blockchain.

TX CONFIRMED & UTXO UPDATED: Bob’s wallet scans the blockchain, detects the confirmed transaction, and updates his balance to reflect the newly received 1 BTC.