Homework on Bitcoin Ecosystem - Questions

Blockchain and Bitcoin 101
#1066
  1. What is the difference between a SPV (simplified payment verification) and a full node?

SPV communicates transactions to a full node. It does not hold a full copy of the ledger.

  1. What does it mean when a transaction is broadcasted?
    The utxo is (sender and receiver info, amount) is placed into a mempool for verification.

  2. How does a miner pick which transactions that gets added to the next block.?
    Normally those with a higher transaction fee.

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#1067
  1. Nodes hold a full copy of the blockchain, from the gennisis block to the current one, which takes quite a lot of memory. This is fine for a large computer, such as a desktop but would be impracticle in a small personal electronic device such as your phone or tablet. So a wallet on your phone will use a SPV and then when it needs access to the blockchain it will communicate with full node.
  2. A transaction is broadcast when your wallet creates a transaction (inputs, outputs and implied fee) and communicates it to a node. The node then puts the proposed transaction into the mempool where it sits until it is compiled in a block with other transactions.
  3. The miner is incentivised to make as much money as possible. Each block has an upper limit for data size in bytes. The miner will try to optimise the number of transactions within this block size limit. If you offer a low fee miners might not pick up your transaction and it will languish in the mempool. In practice your wallet will choose and appropriate fee to ensure your transaction is selected within a reasonable time. It is important to remember that fees are based on the number of bytes it takes to describe the transaction, not the dollar value of the transaction.
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#1068
  1. What is the difference between a SPV (simplified payment verification) and a full node?

SPV take the information from full nodes because it do not have the etire blockchain information in itself, its have to trust in other nodes to verify payments. A full node contain the entire blockchain information.

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

Broadcasted means propagated into the network to be list in the mempol, for been pick by a miner later on.

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

Miners pick transactions with higher fees first.

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#1069

  1. The difference between an SPV and a full node is that only the full node has the entire copy of the blockchain. An SPV (such as a wallet on your mobile phone) is a simplified, condensed version that must trust a full node while reading a copy of the blockchain.

  2. When a transaction is broadcasted - the transaction is sent to a node, which is then added to the mempool, and then a miner for verification.

  3. When it comes to choosing which transactions get added to the next block, the miners select those with the higher fees. They are built on incentive; and a bigger reward in tx fee insures that the higher transaction is picked.

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#1070

  1. SPV broadcasts transactions and communicates as necessary. SPV holds only necessary amounts of network transaction information.

  2. A transaction that is broadcasted is a signed transaction that has been sent to the nodes for entry into the mempool. From there it will be mined into a block.

  3. Miners pick which transactions will be added to the block by arranging them all into the block for highest reward level, through total transaction fees.

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#1071

[quote=ā€œivan, post:1, topic:8444ā€]

  • What is the difference between a SPV (simplified payment verification) and a full node?
  1. A full node runs on a desktop computer and has its own local copy of the full blockchain. An SPV (a wallet on your phone or laptop) lets you check nodes to validate your transactions without having to worry about anybody elseā€™s transactions. It ensures your transactions are in a block.
  • What does it mean when a transaction is broadcasted?
  1. It is when your wallet constructs and signs a TX and sends it out to the nodes and is put in the networkā€™s mempool waiting for a miner to pick it and add it to a block.
  • How does a miner pick which transactions that gets added to the next block?
  1. They will generally pick the transactions with the largest fees as TX fees are calculated on byte size of TXs and they can only fit so many bytes into a block.
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#1072

Homework on Bitcoin Ecosystem - Questions

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    • SPV or a Node, is simply small computer or device that has a non updated version of the blockchain and will always need to query the Full Node for the latest update. This is so that it can save on the space. The full node runs the complete current version of the ledger, it will confirm a block, and continue the chain.
  2. What does it mean when a transaction is broadcasted?
    • it means that all the nodes will be receiving the full update of the latest block.
  3. How does a miner pick which transactions that gets added to the next block?
    • the miners will pick the transactions that has the largest size aka the highest fee. it is not based on the amount.
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#1073
  • What is the difference between a SPV (simplified payment verification) and a full node?

SPV can create transactions, but need to connect to full node to get the information.
SPV can be used on your phone because it doesnā€™t need big hardware space to work opposed to full node.

  • What does it mean when a transaction is broadcasted?

Transaction is send through nodes on the network and added to mempool.

  • How does a miner pick which transactions that gets added to the next block?

Miner chooses transaction from nodes mempool, always the transactions with the highest transaction fee.

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#1074
  1. An SPV is used when you donā€™t have access to the full node. What your mobile device will do is query the full node a bunch of times until it is satisfied that the information you have is the most recent, whereas the full node is the full chain of the current blocks on the network
  2. A transaction is broadcasted to the network to be propagated to check for validity. If it is not broadcasted, it means that the transaction was probably invalid and that the node was rejected. If accepted then it goes on to be propagated throughout the network.
  3. It chooses it by creating a hash value that is based on the previous blockā€™s hash value, the transaction fees and the nonces, such that this hash value is less than a particular target.
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#1075
  • An SPV (simplified payment verification) is different from a node because an SPV does not store a copy of the blockchain like a node. I can simply ā€˜talkā€™ to a node.
  • A transaction is broadcast when it is sent to the network and picked up by the nodes
  • Generally speaking miners will choose transactions with the highest transaction fees attached which are also the largest in terms of bytes
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#1076

An SPV is a wallet app that doesnā€™t have the blockchain. It just sends and receives but uses outsourced nodes to place the transactions sent into the mempool.

A TX is broadcast to the network when it gets sent out to other nodes and gets recorded into their mempools.

miners choose the TXs with the highest fees attached to the TX. Supply and demand will determine if youā€™re TX gets confirmed on the blockchain, too small a fee will result in a longer mempool waiting time until times of lower traffic when your fee amount will finally get picked. setting a higher fee will ensure a greater chance of quick confirmation time.

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#1077

hello,
1) The difference between an SPV and a full node is an SPV does not have a full copy of the blockchain ledger and must get the Date from a node.
2) When you broadcast a transaction through the network, it means that you are sending the transaction to all the nodes in the network where it is placed in the mempool until further propagation can be done.
3) Minors pick the transactions with the highest fees first to get added to the block.

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#1078

Homework on Bitcoin Ecosystem - Questions

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    Answer: A full node has the full blockchain and verifies in that manner. An SPV is a version used in some wallets which makes use of a significant number of nodes and gives likelihood and probability of being correct but not as much as a full node. Basically SPV is a kind of partial node.

  2. What does it mean when a transaction is broadcasted?
    Answer: Once a block is sovled by a miner or verified by a node it is ā€œbroadcastā€ to those miners and nodes which have not received this information yet.

  3. How does a miner pick which transactions that gets added to the next block?
    Answer: Usually the miner or mining rig will choose the ones with the best reward, lowest cost or best availability - basically cost motive.

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#1079

  1. The SPV dont have the full blockchain stored since it would take a lot of space, instead it ask a full node for the status of the blockchain.

  2. It means that is propagated between all nodes to make sure a miner pick it up from the mempool.

  3. The miner choose from the mempool (usually the ones with highest fees) by checking his local mempool or/and checking a node mempool.

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#1080

it is used for leightweight wallets (mobile phone wallets),
where running a full node is not reasonable.
This SVP will gather the blockchain info from ā€œneighbouring nodesā€,
it acts as an information service and broadcasts/mediates the unconfirmed tx to the nodesā€™ mempool(s).

if the transaction is unconfirmed it means all nodes rate this transaction as valid,
the valid unconfirmed transaction will be listed in the mempool, it will stay there until a miner
takes this transaction and put in one blockā€¦ if the miner generates a nonce quick enough

a miner prioritises txn with high fees

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#1081

It first has to propagate to each and every node in the network. Each nodes put the transaction into their own mempool. :slight_smile:

#1082

Its important to note that an SPV needs to trust a full node. Thatā€™w why some people may prefer to run their own full nodes. :smiley:

#1083

There isnā€™t one main mempool. Each of the miners have their own mempool. :smiley:

#1084

Before the transaction is added to the latest block, it is propagated throughout the network. Your transaction will reach every node and their mempools. After that, one of the miners will finally include it in a new block. :smiley:

#1085

Each node has their own version of the mempool.