Homework on Bitcoin Ecosystem - Questions

Blockchain and Bitcoin 101
#1948
  1. Full nodes store entire blockchain, a SPV does store entire blockchain and queries a node from the blockchain for the data
  2. The transaction is propagated to the all the nodes in the network and put into the mempool
  3. Miners pick transactions with the highest fees
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#1949
  1. What is the difference between a SPV (simplified payment verification) and a full node?

a full node stores the entire blockchain, an SPV is able to query it from other nodes

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

a transaction is sent out to the network of nodes & miners to be validated; it is put into the mempool

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

usually based on the transaction with the highest transaction fee included

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#1950

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    A SPV doesn’t have the entire blockchain data so it have to ask the nodes for that info.

  2. What does it mean when a transaction is broadcasted?
    It means that the transaction its send to all the nodes around the world at the same time.

  3. How does a miner pick which transactions that gets added to the next block?
    The miner looks for the most convenient TX inside the mempool. These will be the ones with higher fee rate

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#1951
  1. A SPV does not maintain the full blockchain ledger and communicates with a node that does, so it may functionally transact on the blockchain. A full node maintains the full blockchain ledger and may initiate its own transaction without needing to communicate with another node first - such as in the case of the SPV.
  2. A transaction is broadcasted when the wallet (or private key) signs the transaction, and releases it to the blockchain mempool for nodes to verified and mine it. The transaction enters the network.
  3. A miner will pick the transactions with the highest fees to add them to the next block as they are financially incentivized to do so.
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#1952
  1. What is the difference between a SPV (simplified payment verification) and a full node?

A SPV ensures your transactions are in a block and provides confirmations without keeping up to date with the whole block-chain. A node runs a continually updated version of the ledger.

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

This is when a node communicates a transaction with other nodes.

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

The miner selects high priority tx, adjusted by fees, and will validate it’s request, recording it on the block.

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#1953

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    SPV is a mobile which is to read the transactions from Nodes like PC.

  2. What does it mean when a transaction is broadcasted?
    It means its shared to the network and went into the mempool.

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#1954

3.How does a miner pick which transactions that gets added to the next block?
They try to chose the ones which has high fees and also simplicity of the transaction to try to contain more into one block. The simple ones use less bytes so it is possible to contain more in a block.

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#1955

  1. SPVs have an incomplete version of the blockchain and rely on full nodes to check the full version of it

  2. A transaction is broadcast by a node to other nodes after it is verified as a valid one and added to the node’s mempool

  3. The miner will choose transactions form accessible mempools and pick the ones with the highest fees

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#1956

  1. A node is a complete transaction ledger or a blockchain data which is in sync with whole network, while SPV just the queries transactional and balance information and confirms the same from various nodes.

  2. When a transaction is broadcasted it goes to mempool for queing in the blocks for transaction confirmation as an entry in Blockchain.

  3. Normally when transactions are broadcasted the network fees is selected by the person doing transaction. Now the miners are working for incentives, so they will pick the transaction with higher fees from the mempool till block of 1 Mb size is full and remaining transaction with higher fees are queued for next block in 10 minutes.

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#1957

1- spv it doesn’t have the full database version of the blockchain and it scans frequently the blockchain to see what’s you’re utxos. you can use spv to broadcast, receive e check your wallet utxos.
A full node has a database with all the blockchain since the start and the other feature of the spv.

2- a transaction is considered broadcasted when you send it to a node and suddenly spread at the entire network of nodes.

3- a miner check the node’s mempool and pick the transactions with the highest fees to put in a block.

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#1958

A SPV is a reduced form of a Node, it doesn’t have a full copy of the blockchain and only store transactions that are relevant to it’s own addresses, and it communicates with a Node to send transactions.

It means that the transaction was accepted, and it was propagated through the network, to be added to the mempool.

Miner picks the transaction with the highest fees first (satoshis per bite ratio)

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#1959
  1. SPV are smaller versions of nodes that can query information from the blockchain but not actually hold information of the blockchain as a node would.
  2. It is sent to the network of nodes to be publicized to the chain.
  3. By the incentives, which is usually fee-based.
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#1960

  1. The difference between a SPV (simplified payment verification) and a full node is that a full node keeps a copy of the full block chain on it at all times that is also updated. A SPV(something like a smartphone) does not keep the block chain on it, but askes a full node what has happened with the chain to verify.

  2. What it means when a transaction is broadcasted is that a transaction has taken place and has been put into the mempool.

  3. A miner picks which transactions that gets added to the next block by choosing which transaction will make him the most money.

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#1961
  1. SPV has a subset of data and not the full data. SPV can be used to create new transactions.
  2. Broadcasting is sending the transaction to the network so that the transaction can be confirmed and become a part of the blockchain.
  3. Miners look for transactions with largest fees.
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#1962

  1. Full nodes store a copy of the blockchain, including all the information related to UTXOs, the whole mempool and additional data, while SPVs usually have limited space (in matter of memory) and can’t afford keeping all this data, therefore they have to “trust” some full node and connect with it to receive such information.

  2. It means that one of the full nodes is making statement about a transaction request. This request is spread through out the whole blockchain, so that every full node can check if such action would make sense. Also when the transaction is broadcasted, miners are now able to mine it if they decide so.

  3. Since miners are “working” for earnings - they pick the most profitable for them transactions first (those with highest fee/size value).

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#1963

Homework on Bitcoin Ecosystem - Questions

  1. What is the difference between a SPV (simplified payment verification) and a full node?
  • an SPV is a lightweight “node” that can run on mobile devices and other low resource devices. Depends on full nodes to know the state of the blockchain.
  • a full node has higher mem and HD requirements and has a full copy of the ledger.
  1. What does it mean when a transaction is broadcasted?
  • A tx is broadcasted by a wallet and then propagates across the network to all nodes where it sits in the mempool waiting to be included in a validated block.
  1. How does a miner pick which transactions that gets added to the next block?
  • miners care about money so they will prioritize txs with the highest fees first.
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#1964
  1. SPV only hold transactions from its addresses, while a node contains a copy of the entire blockchain.
  2. It’s when the transaction is propagated to all the nodes.
  3. The miner chooses transactions from the mempool with the highest fees.
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#1965
  1. What is the difference between a SPV (simplified payment verification) and a full node?
  • SPV’s generate transactions where as a Node cannot, a Node holds the full blockchain data and SPV holds only the necessary Block data for its current task.
  1. What does it mean when a transaction is broadcasted?
  • A TX is sent from a wallet address as an output derived from UXTO’s to the network to be mined.
  1. How does a miner pick which transactions that gets added to the next block?
  • The TX’s with the highest fees are always mined first as they have requested a faster process - competing for block space by increasing the fee (priority)
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#1966
  1. What is the difference between a SPV (simplified payment verification) and a full node?
  • A full node has the entire copy of the blockchain, SPV needs to query a full node to access the blockchain.
  1. What does it mean when a transaction is broadcasted?
  • It means that it is spread across the network to be validated.
  1. How does a miner pick which transactions that gets added to the next block?
  • Based on the transaction fees. Miners will pick transactions with the highest fees in satoshi/B
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#1967

  1. The difference between Full Nodes and SPV is that Full Node keeps a complete copy of all the bitcoin blockchain with all their transactions. SPV downloads the block headers only and exclude the transactions of each block. This makes it possible to be on a mobile device to be stored locally.

  2. A transaction that is broadcast means that it was sent to all the other nodes to see.

  3. A miner picks a transaction that gets added to the next block based on the highest fees and sat/B.

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