Homework on Bitcoin Ecosystem - Questions

Blockchain and Bitcoin 101
#2088

  1. A SPV can interact with the block chain meaning you can have a wallet with your private keys on it. A full node contains the data of the full blockchain (100s GB) and are usually found on laptops, desktops, and miner rigs.

  2. It means a transaction has been submitted from a wallet to a node, to be verified by miners.

  3. Miners usually store transactions with the highest sat/byte ratio so that they can receive the higher fees.

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#2089

Spv has only part of th blockchain and has to check with nodes

Means that transaction information has been sent to other nodes

By the higher fee paid

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#2090

1 with spv you can verify a transaction without downloading the whole blockchain
2 a transaction is broadcasted when it is send to the mempool of the network in order to be mined in a block by the miners
3 Miners have a financial incentive because they also receive the transaction costs. so they will mine the transactions with the highest fees first

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#2091
  1. SPV does not have a full copy of blockchain, it stores mostly transactions relevant to its address. SPV can connect to the full node that has stored the entire blockchain, there it can get the information and verify transactions.
  2. This means that a node accepts the transaction and propagates it through network.
  3. Transactions are located in a mempool and miner will pick the ones with the highest fees.
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#2092
  1. SPV does not contain info of the whole blockchain but data needed to generate the transaction, full note does.
  2. It has been send to the mempool and it is spreading over to all nodes in the network.
  3. The miners usually pick the transactions with the highest fees inside of the mempool to maximize their profits.
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#2093
  1. Full nodes hold the complete block chain ledger where as SPVs only store limited data from the blockchain usually relevant to only addresses being used.
  2. A transaction has been signed and a UTXO is sent out into the blockchain network, first being sent into the mempool waiting to be picked up by a miner so it can be validated on the blockchain as a spent transaction.
  3. A miner uses greed to pick the transactions so the highest fees paid for transactions tend to be picked up first.
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#2094

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    An SPV doesn’t have a full copy of the blockchain and must check in with a node for information on the blockchain.

  2. What does it mean when a transaction is broadcasted?
    It is sent to some nodes which then send it to other nodes, and each node stores it in the mempool.

  3. How does a miner pick which transactions that gets added to the next block?
    However they want, but most likely they’ll pick the most profitable valid transactions, so the transactions with the highest fee per bit first.

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#2095
  1. A full node stores the entire blockchain, a SPV no.
  2. The transaction is spread in between the nodes.
  3. The miner will pick the transactions with higher fees.
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#2096

  1. a full node has access to/holds a copy of the full blockchain while SPV holds UTXOs specific to the addresses that it is dealing with

  2. When a transaction is broadcasted, it is sent to all of the other nodes

  3. The miners will pick the transactions that will give them the highest transaction fees

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#2097
  1. What is the difference between a SPV (simplified payment verification) and a full node? SPV checks nodes for copy of blockchain. node keeps entire blockchain
  2. What does it mean when a transaction is broadcasted? propegated tx throughout network for the nodes to validate tx is valid.
  3. How does a miner pick which transactions that gets added to the next block? miners select tx with most fees from the mempool
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#2098

  1. A full node has a copy of the entire blockchains meanwhile the SPV does not have it and it requires the informations of the full node to be able to perform a valid transaction.

  2. It is when a transaction has been send, sync by the entire network.

  3. It is picked with the higher transaction fees

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#2099

  1. an SPV does not have a copy of the full blockchain where a full node does. SPV’s instead communicate with full nodes to receive information about a small portion of the overall blockchain.

  2. This means it is sent to the mempool where it will wait to be finalized by a miner who puts it in a block that they then try to get added to the blockchain.

  3. They pick based on which ones have the highest sat/B ratio because that means that can fit more transaction fees into that block and get paid more if they successfully mine that block.

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#2100

1.- SPV’s hold the necessary data to make transactions and are not as heavy as carrying all the blockchain like a full node.
2.- It is distributed around so it can be confirmed.
3.- It generally picks the ones that have the highest fees.

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#2101

  1. SPV differs from a full node in that an SPV does not have full access to the blockchain. SPVs rely on nodes to provide them information from the blockchain.

  2. When a transaction is broadcasted, it becomes public. The transaction is transferred onto the public blockchain for everyone to see.

  3. A miner earns transaction fees from transactions that have been accumulating in the mempool. A miner typically will pick transactions with the highest transaction fee from this mempool once they solve the cryptographic puzzle for the block.

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#2102

First the transaction will gossip around to all other nodes their mempool until a miner mines it into a block

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#2103

  1. A full node store all the data from the blockchain. An SPV needs to access the data from a full node to initiate a transaction.

  2. It means that the data of the transaction goes through the whole blockchain.

  3. He chooses to mine the transactions with the highest fee return in the mempool.

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#2104

When you broadcast a transaction, it is placed in the mempool of the full node that broadcast it. Then this transaction will gossip with their connected peers who will also gossip the transaction to their peers until a miner takes it from the mempool and mines it into a block.

tx-download
tx-download794×1535 357 KB

https://github.com/amitiuttarwar/bitcoin-bytes/blob/master/mempool.pdf

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#2105
  1. What is the difference between a SPV (simplified payment verification) and a full node?
  • A full node stores a complete copy of the blockchain from the genesis block. It doesn’t have to trust anyone but the protocol itself. A SPV instead leverages already existing full nodes for the state of the blockchain. This lessened the computing cost at the expense of trusting a 3rd party a valid trade off for a mobile app for example.
  1. What does it mean when a transaction is broadcasted?
  • Meaning a wallet has made a valid transaction and has sent it to nearby nodes in the network which in turn put the transaction into the mempool for a miner to eventually put it into a block.
  1. How does a miner pick which transactions that gets added to the next block?
  • It simply picks the transactions with the highest transaction fee.
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#2106
  1. What is the difference between a SPV (simplified payment verification) and a full node?

An SVP is not a full node and in order to verify a transaction it only requires access to a copy of the largest chain of blocks to update a payment.

  1. What does it mean when a transaction is broadcasted?

It means that the transaction is propagated through the network so that miners can verify it and update the blockchain.

  1. How does a miner pick which transactions that get added to the next block?

By mining the transactions with highest fees.

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#2107
  1. an SPV does not store the entire blockchain and needs nodes to feed it with the latest info
  2. means that the latest blockchain is communicated to all nodes
  3. based on the highest fee = satoshis per bit
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