Homework on Bitcoin Ecosystem - Questions

Blockchain and Bitcoin 101
#1246

Homework on Bitcoin Ecosystem - Questions

What is the difference between a SPV (simplified payment verification) and a full node?
A SPV does not hold a copy of the full blockchain. Svp gets his data from a full node. A full node holds a copy of the full blockchain.

What does it mean when a transaction is broadcasted?
Every node receives a copy of a transaction, will check the transaction if it is correct and will pas it on to other nodes in the network.

How does a miner pick which transactions that gets added to the next block?
The minder will pick the transactions that are correct and have the highest fee

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#1247

  1. A SPV is linked to a full node. A SPV can be something like a phone for example. The blockchain is too big to be stored on a phone, it takes too much GB for a normal phone. So a SPV checks a full node or usually different full nodes to validate the blockchain. So that is does not have to store the entire blockchain itself.

  2. It means a transaction is sent through the network of nodes.

  3. They look at all the txs in the mempool and will usually choose all the txs with the highest tx fee untill the block size is filled.

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#1248

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    SPVs get their information from a single node. While the nodes are connected to the entire blockchain network. If you have a wallet on your phone it is probably a SPV. It doesn’t acquire that much computing power. Both SPVs and nodes have an overview of the entire blockchain.

  2. What does it mean when a transaction is broadcasted?
    This is the third step of a transaction after it is constructed and signed with your private key. The transaction is now in the mempool waiting to get picked up by a miner to be put in blocks.

  3. How does a miner pick which transactions that gets added to the next block?
    It picks transactions that have the right correlation between fees and Sat/B. The higher the Sat/B the higher the fee. The miner that adds transactions to the block, and the block is confirmed, gets rewarded with the fees in every transaction (plus the block reward).

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#1249

Transactions as they are broadcasted don’t go on the blockchain yet. First they get stored in the mempool for the miners to pick them up :slight_smile:

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#1250

I confused myself lol. But now I understand since you said that

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#1251

A miner usually picks transactions with higher sat/B value :slight_smile: it doesn’t have anything to do with the difficulty which is based on the network hashrate

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#1252

SPVs usually get their information from multiple full nodes in the network :slight_smile:

That is true, but how does SPV node achieve that? :slight_smile:

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#1253

[quote=“ivan, post:1, topic:8444, full:true”]
Homework on Bitcoin Ecosystem - Questions

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    A SPV does not run a full version of a blockchain, it has to query another system node to determine the data it needs while a full node has a full version of the blockchain and can query the ledger directly.

  2. What does it mean when a transaction is broadcasted?
    It means the transaction is send across the network for all the nodes to verify and add it to the blockchain

  3. How does a miner pick which transactions that gets added to the next block?
    The miner query either the pool of transaction on the blockchain system called mempool which is either present on the Miner nodes or other nodes on the network that does not perform the function of mining to compete to select preferably transaction with the highest transaction fee to add to the blocks it’s mining.

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#1254
  1. A spv dont have a full copy of the blockchain like a full node do.
  2. When a transaction is broadcasted it is send from the wallet to the nodes and out in the mempool.
  3. The miner pick the transactions with the highest fee from the mempools.
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#1255
  1. SPV does not have the full blockchain stored locally, but will have to verify with nodes for the status of the blockchain
  2. it is distributed throughout nodes in the blockchain network
  3. based on the height of the transaction fee
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#1256
  1. SPV: It doesn’t store the entire block chain. It does store a private key without blockchain. It communicate to another NODE. It is online and it is located in an application stored in a phone.
    A full Node has the private key and a copy of the blockchain.
    2.A broadcasted transaction is a transaction that is signed and exposed to the network by a wallet. The wallet check the blockchain to find UTXOS, they make transactions with inputs and outputs and broadcast the transaction to the network.To the Nodes.
    3.Miners compete with each other trying to solve the Cryptographic puzzle. They ensure that the transaction can’t be censored . By doing that they get incentives. In fact, they want to make money by making sure the network remains secure. If they follow the rules, they will make money. Before getting rewarded the block has to be propagated through the network.
    The miner choose the transaction with the highest fee.
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#1257
  1. A SPV doen’t have a full copy of the blockchain and relies on full node to get info
  2. Propagated to the entire blockchain
  3. Chose the ones with higher fees
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#1258
  1. The difference between a Simplified Payment Verification (SPV) and a full node is that a full node stores the whole blockchain from the beginning, while a SPV only stores a few blocks back. An SPV relies on other nodes in the network to update it with information about the blockchain. The advantage with a SPV is that it is much less memory intensive to run than a full node, so it can be run on mobile phones. The disadvantage is that you have to rely on this other node.
  2. When a transaction is broadcasted, it is propagated through the network to the other nodes.
  3. A miner picks transactions from the mempool (pool of pending transactions) that are added to the next block by looking at the SAT/byte of the transaction. The wallet of the sender of the transaction usually automatically chooses a transaction fee, and the miners will choose the transactions with the highest transaction fees per byte. This way, the miners maximize their total transaction fees from the block.
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#1259

Homework on Bitcoin Ecosystem - Questions

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

A full node has all the information on the blockchain an SPV does only has the headers of the blocks

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

It is signed and is propagated to all nodes and waiting to get confirmed

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

Usually they pick the transactions with the highest fees from the mempool

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#1260

It gets propagated through the network, but is not part of the blockchain yet :slight_smile:

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#1261

SPV also contains some parts of the blockchain that are important to the keys it stores :slight_smile:

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#1262

  1. An SPV does not contain the whole blockchain but it talks directly with a node that has in order to verify txs

  2. A transaction is sent to the mempool for verification

  3. Usually the ones with higher fees are processed by a miners and if the nonce is solved it gets added to the blockchain

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#1263
  • What is the difference between a SPV (simplified payment verification) and a full node?
    An SPV may not have the full database in it.
  • What does it mean when a transaction is broadcasted?
    Boadcasting involves propogating the transaction to the various mempools
  • How does a miner pick which transactions that gets added to the next block?
    the transaction that provides the most inentive is typically chosen
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#1264

  1. A full node is an updated version of the complete blockchain running on a computer. A SPV has a simplyfied version of the blockchain, and will enquire a full node for truth.

  2. It means that the transaction is being sent through the entire global network of nodes communicating with each other.

  3. The miner is incentivised to pick the transactions with the highest fees from the mempol.

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#1265
  1. A full node holds the whole BC, the SPV just holds the private key and must post a query to a full node in order to verify the total UTXO and ask the node to broadcast the transaction.
  2. A transaction must be covered, there must be enough UTXO associated with the wallet in order to make it sane. We also must make sure the output is less than the input. If this is the case the node can communicate the transaction to a mempool so a miner can pick it up and include it tn the new block.
  3. I assume the mempools are readable for the miners in some way, and the miners may select transactions to include in his block, preferably transactions with a high return for the miner. (sat/B)
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