Homework on Bitcoin Ecosystem - Questions

Blockchain and Bitcoin 101
#222

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    A SVP doesn’t have a full version of a blockchain data, they have to get that information on a full node in order to generate transactions

  2. What does it mean when a transaction is broadcasted?
    It means that data is spreading true the nodes

  3. How does a miner pick which transactions that gets added to the next block?
    The miner cheeks in the mempool the transactions with highest fees. In case of get the block mined on the chain, the miner gets the reward and all the fees in the transactions on.

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#223

An SPV creates a transaction, and then broadcasts it. It only stores a small portion of the blockchain because the full blockchain would require too much storage space. A full node has the storage capacity to hold a full copy of the blockchain and takes the UTXOs that were broadcasted and adds them to the mempool for miners to choose.

A UTXO created by a wallet is sent out to nodes to be added to the mempool.

A miner picks the transactions with the highest fees so they are incentivized the most for the electricity they used to solve the block.

#224
  1. What is the difference between a SPV (simplified payment verification) and a full node?

Unlike a Fullnode a SPV does not contain a full copy of the blockchain. SPVs can be on your phone and connect to a full node in order to validate transactions.

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

UTXO are sent throughout Bitcoin network this info is sent out to all the nodes on the network and each node updates it’s ledger with the transaction info.

  1. How does a miner pick which transactions that gets added to the next block?
    Miners are paid thru fees and mining rewards, so miners typically pick the transaction from the mempool with the highest fee.
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#225

  • What is the difference between a SPV (simplified payment verification) and a full node?
    An SPV is not a Full Node. It does not have a copy of the blockchain and only validates your own transactions as a wallet

  • What does it mean when a transaction is broadcasted?
    It means that the transaction is sent out to the nodes who then place it in the mempool for a miner

  • How does a miner pick which transactions that gets added to the next block?
    A miner can pick transactions from the mempool and usually selects the ones with the higher fees.

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#226

  1. A full node is connected to the network and receives, saves and broadcasts all the latest transactions to all the other nodes in the network. SPVs, such as user’s wallets, do not download the entire blockchain; instead they use nodes to confirm transactions.

  2. After a node has verified a transaction it sends it to all other nodes in the network to add to their mempools.

  3. Miners prioritise transactions in a mempool based on which will earn them the highest transaction fee.

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#227
  1. What is the difference between a SPV (simplified payment verification) and a full node?
  • Node communicator, with reduced versions of the blockchain
  1. What does it mean when a transaction is broadcasted?
  • transaction is being propagate in the entire network trough the nodes
  1. How does a miner pick which transactions that gets added to the next block?
  • Chooses the mempool with the highest reward
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#228

[quote=“ivan, post:1, topic:8444”]

  • What is the difference between a SPV (simplified payment verification) and a full node?
  • What does it mean when a transaction is broadcasted?
  • How does a miner pick which transactions that gets added to the next block?
  1. Simplified payment verification is small node carrying less blockchain ledger due to its capacity like phones.
    2.) It means the transactions are being send to the network of computers nodes to be verified
  1. Miners usually pick the transactions with the highest fees first as they are in the business of making money. Secondly, they are incentivize through block rewards to do so.
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#229
  1. A full node have the whole information about the blockchain
  2. That it is in the mempool and other nodes are aware of it
  3. The miner chooses the transactions that will give him the biggest amount of money.
#230

1- SPV doesn’t have a full copy of the blockchain

2- A wallet initiates a output

3- They pick the ones they can get the highest fee per byte

#231

an output is only a part of the transaction. The whole transaction gets broadcasted to the network (inputs, meaning utxo’s you own + outputs where the utxo’s are going etcetera)

#232

Thanks for the input. My answer was a bit condensed.

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#233
  1. A full node stores the entire blockchain. A SPV contains limited information and must query the full note for information and for updates. Since the blockchain is so huge, one example of SPV’s would be on a mobile phone where its not feasible to store the entire blockchain.
  2. A broadcasted transaction simply means that once it gets validated, it goes into a mempool waiting to get picked up by a block for subsequent mining and appending of the block to the blockchain.
  3. Miners are financially incentivized to recuperate their mining electricity costs. Therefore, they will then always prefer to mine the blocks with the highest reward i.e., the highest sats/byte.
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#234
  1. The SPV can be treated as a light version of a full node, which doesn’t store the whole blockchain locally. It has to connect with the full node to verify transactions. While the full node keeps the entire copy of blockchain with all transactions.
  2. It means that the transaction is accepted by the node and gets propagated by the whole network.
  3. Miner mostly chooses the transactions with the highest fees to be added to the next block.
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#235
  • What is the difference between a SPV (simplified payment verification) and a full node?
    The SPV can create transactions but does not hold the full blockchain so will need to connect to a full node to access the blockchain.
  • What does it mean when a transaction is broadcasted?
    The transaction has been created by the wallet and is then sent or broadcasted to all the nodes on the network.
  • How does a miner pick which transactions that gets added to the next block
    The miner will pick the transactions which have the highest fees
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#236
  1. Spv doesn’t have the full blockchain and should ask node to get necessary data
  2. Transmitted to all the nodes
  3. They pick first the ones with higher fees
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#237

  • What is the difference between a SPV (simplified payment verification) and a full node?
    SPV stores transactions related to its function as a full node stores the block chain entirety.

  • What does it mean when a transaction is broadcasted?
    A block is accepted into the block chain, confirmed and sent throughout the network

  • How does a miner pick which transactions that gets added to the next block?
    Which ever transaction that has the highest Tx fee will be accepted first.

#238
  1. SPV don´t have the full blockschin like a note. They get the information of the lates blockchain from the note.
  2. it means that it is send to all the notes in the network.
  3. he pick the transaction with the bigges fee. Because he wants to earn money.
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#239

SPV does not have a fully copy of the blockchain - only transactions relevant to its addresses. An SPV has to connect to a full node to verify transactions on the blockchain.

When a transaction is broadcast it is propagated to all nodes throughout the network.

A miner picks up transactions from the memepool to include in a block. These are often selected based on the fee sats/B

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#240

  1. A SPV does not itself carry the entire blockchain, but rather trusts a number of full nodes and checks if there is consensus between these nodes. The SPV only stores information which is relevant in relation to its addresses. Blockchain queries are made through trusted full nodes.

  2. The transaction is propagated though the network and thus added to the mempool, waiting to get added to a block.

  3. The miners can themselves choose which transactions to include within a block, but are incentivised by transactions fees. Only a certain amount of bytes fit inside a block and thus miners usually prefer transactions with higher transactions fees pr. byte.

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#241
  1. An spv only stores a part of the blockchain as opposed to a node that holds an entire copy. SPV’s connect to nodes to work properly.
  2. It means the transaction is being propagated trough the nodes
  3. It will pick from the mempool those transactions with higher fees
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