Homework on Bitcoin Transactions and UTXO - Questions
Describe what Unspent Transaction Outputs (UTXO) are.
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
How would a bitcoin wallet specify the transaction fee when creating a transaction?
How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
UTXO is like change from a previous transaction.
Use more then one UTXO.
The difference between inputs and outputs.
Using many inputs and outputs. Though effective to someone reading block explorer this is useless privacy measure for software based tracking.
Describe what Unspent Transaction Outputs (UTXO) are.
Transactions you have received and can be spend.
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Transaction will not be valid and send by the wallet on the first place, not accepted by the miners in a second stage.
How would a bitcoin wallet specify the transaction fee when creating a transaction?
Fee = input - output
How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
Make use of different addresses when you want to receive something.
UTXO are the bitcoins which you have received and not yet spent from your wallet.
It will sum up all possible other small UTXos to make a large transaction as required and change will be credited to your account after deduction of transaction fees.
Bitcoin transaction fees is implied. Its not explicitly specified
Anonymity is provided by the nature of bitcoin transactions as output can be sent to multiple channels as well to same input channel. No one knows except the private key owner.
@Alko89 your second answer seems to be wrong. It will sum up more than one utxo to make up bigger trx rather than invalidating.
You are right.
It is true in case if any single UTXO, It will sum up more UTXOs. If there is no sum of multiple UTXOs that make up larger output, the transaction is invalid.
Thanks for correcting.
UTXO = Input, can be used to be spent in another transaction. If UTXO is zero, that means you can make any transaction.
My wallet can calculate my UTXOs, if the sum is enough to pay my transaction, the transaction can be executed.
A bitcoin wallet recommend a reasonable fee, bases on the current and previous transaction fees.
Always generate new addresses, especially the outputs, so that it is hard to tell which output goes back to the sender.
Unspent Transaction Outputs (or UTXO’s) are essentially a transaction. As their input they have all the current unspent transactions associated with your bitcoin wallet and its outputs are other wallets you are sending bitcoins to, including your own. The inputs of the transaction should equal the outputs less the transaction fee.
Your wallet adds all you UTXO’s together. If you had enough UTXO’s when they are collectively added together the transaction would be processed. Otherwise the transaction would be rejected.
The transaction fee is implied rather than specified. The amount sent to the other accounts (including back to your own if there is any left over) will add up to slightly less than the sum of all the UTXO’s input. That difference is the transaction fee.
Since you cannot be sure who each output transaction goes to due to the encryption you cannot be sure what value of the UTXO’s output to yourself
Unspent Transaction Outputs (UTXO) are the data created from a previous transaction. The total value of all UTXOs connected to a single wallet display your “balance,” or the remaining unspent transactions outputs available for your use.
The transaction will be denied because there are no available UTXOs to meet the minimum transaction amount requested.
The transaction fee is the difference between the transaction inputs and transaction outputs. Also, when sending a transaction, you can choose the fee manually in an attempt to expedite the transaction speed or save more by reducing the amount of the fee, thereby potentially reducing transaction speed.
You can increase the number of outputs to make tracking transactions more difficult since addresses hold no personal information and are not associated with one another, except when a transaction between them is made. Several outputs could be addresses you own and nobody would know.
Your balance
It will add up other UTXO’s untill you have enough funds. If you don’t have enough, your transaction will be disgarded.
It is the total of the inputs - the total of the outputs
you can’t, you can track all UTXO’s. it looks like random numbers and letters, but once a person had been linked to an TX you can find all transactions which are linked to this one.
UTXOs are all the transactions whose stored bitcoins are not spent and are held by the person whose bitcoin address has been mentioned.
The transaction will not confirm
It looks at the recent tx fees on the blockchain and proposes u the value
Generate new output addresses, and also have multiple output addresses
1. Describe what Unspent Transaction Outputs (UTXO) are.
Outputs from other transactions that are not spent yet. If you want to spend a certain amount of bitcoin, utxo’s you own are added together to be spent.
2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Other utxo’s that you own will be added until you have enough for the transaction
3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
It will be deducted from the utxo’s used for the transaction.
4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
If you create different addresses each time you do a transaction, all the bitcoin will be moved to that new address (minus the fee or payable amount). Since addresses are not linked to an identity it is hard to try to link utxo’s to an individual.
Unspent Transaction Outputs are outputs from a previous transaction that are available and have not been spent.
If you do not have any single UTXO large enough to cover your transaction then the transaction will be declined.
The bitcoin wallet specifies the transaction fee when creating a transaction by substracting the input from the output.
From the outside it is impossible to know which output went where, to the recipient, to the sender and there can be multiple outputs. That increases anonymity in transactions.
UTXO is basically, your amount of bitcoins, which you have in your wallet to spend. They are unspent so far.
The blockchain will check your UTXO first and after noticing that you don´t have enough founds, it will decline your transaction.
Fee= Input-output
You could make a lot of transaction to others and to yourself. From outside it is impossible to know, which transaction went where.
UTXO is the balance of all transactions sent to your wallet.
The transaction wont go through.
Input - UTXO = fee and your wallet will do this by itself.
Because someone can use many different addresses to spend their UTXO and one of them may be an address sent to themselves and no one will be able to tell.
