What are Transaction Triggers?

Let’s begin with the fact that a blockchain is a decentralized distributed ledger that is made up of a series of discrete blocks of data. Each block contains information on transactions that occurred within a specific time period, as well as a unique identifier (hash) that allows it to be distinguished from other blocks in the chain.

Only when the blockchain has been updated to reflect the transactions on the public ledger, they are considered genuine. Depending on the chain, transactions must be certified by a number of network participants known as miners or validators. 

Therefore, transaction triggers can be set up to group various transactions and execute them when certain conditions are met. This is convenient and provides assurance for users in various ways. For instance, users can create a stop-loss order to cancel their positions on decentralized platforms when the prices of the assets they have borrowed fall below a specific limit. This way they can mitigate losses and manage risks.

Since cryptocurrencies are volatile assets with prices that vary too quickly for consumers to react, this can be quite useful. Especially during bear markets. Besides, it eliminates the need for constant monitoring, which can be both impractical and time-consuming.

Users can also set transactions triggers in bull markets. For example, limit orders on decentralized exchanges can be used to make a profit when the price of cryptocurrency rises to predetermined levels.