1.UTXOs are basically just the outputs of previous transactions, which are tracked and aggregated by an owner’s wallet, and when added together equal the sum total of a wallet’s balance. They can be used for future transactions.
2. If their are multiple UTXOs that add up to the transaction amount it will use multiple UTXOs, otherwise the transaction will not go through.
3. It would prompt/ recommend a few that will get it through the network quick enough based on analyzing the most previous transaction fees on the blockchain.
4. You could have multiple public/ private key pairs. If your identity itd already linked to one if those parties, you can output to a different one that you own which is not yet associated. From the outside looking in, it is impossible to know which outputs correspond to which owners.
Q1: Describe what Unspent Transaction Outputs (UTXO) are.
A1: Transaction Inputs that have not yet been spent/output.
Q2: What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
A2: Wallet selects best combination of inputs (UTXOs), sends output transaction to recipient and deducts fee and creates a transaction for the balance which will be returned back to originating sender (new input/UTXO)
However, the transaction will be deemed invalid (will fail) if the total value of all UTXOs is less than the total output value.
Q3: How would a bitcoin wallet specify the transaction fee when creating a transaction?
A3: Fees are implied - i.e. derived from:
- Sum of original UTXO value - Sum of spent value - Return to Originator UTXO value.
Q4: How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
A4: The use of multiple addresses in a wallet can increase privacy and anonymity.
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UTXO are tokens in an address that have not been sent to another address or in simpler terms the actual balance of crypto that your address has.
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If you broadcast a transaction that is not covered by the amount of UTXO that you have, the miners/nodes will deny your request because you will not be able to spend what you don’t have.
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The transaction fee is the difference between the amount of the input and the output.(Input minus Output = TX fee)
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You can have multiple addresses involved in the input and multiple addresses involved in the output of a transaction.
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Unspent Transactions Output is basically an output from a previous transaction that is available in your wallet to be spent. The sum of these UTXO’s give you your account balance.
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If you don’t have a single large enough UTXO that can cover your transaction, then it will combine with another UTXO to make the transaction and the Balance UTXO will be sent back to your wallet. Similar idea as paying receiving $2 change when paying an $18 bill with $20.
If you don’t have other UTXO’s to combine with, that means the amount you want to send is more than what you own. -
Bitcoin transaction fee is calculated by finding the difference between the Input and the output. Wallets allow its users to set the transaction fee they want to pay if they want to save up money on the transaction and are willing to wait (Lower fee) or Make transaction ASAP (Higher Fee).
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You can increase Privacy by sending the balance output to other address(es) you own and control.
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UTXOs are transactions outputs that have not yet generated other transactions inputs. In other words, the sum of the UTXOs make up the Bitcoin/crypto balance of a wallet.
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The transaction would be rejected, because the wallet´s total balance is not enough to cover the sum of the output and the transaction fee.
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It researches the previous fees on the blockchain and proposes to the user.
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You may spread the transaction funds through different outputs or receive funds via many inputs in different wallets.
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UTXO’s are an transaction input that goes to your wallet and that you can redirect to another wallet from someone else or your own wallet.
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than the transactioin won’t be accepted because it alway’s checks if you have enough balance/bitcoins.
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the wallet will do this by calculating the best fee possible at that time. And makes it also a good fee that a miner will exept the fee fast enough. Or for short Fee=Input-Output.
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you can create a lot of outputs but nobody will be able to tell to who this trasaction went because the adresses are just a bunch of numbers.
1-> The unspent Transaction Output (UTXO) is the transaction what is received but not spent
2-> Then there will be no transaction until you combine UTXO so you can cover the transaction
3-> The wallet looks to previous transaction fees on the blockchain
4-> Using multiple adresses also controled by you`re self
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Describe what Unspent Transaction Outputs (UTXO) are.
UTXO represent the balance of the wallet -
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
The transaction would not be executed.
- How would a bitcoin wallet specify the transaction fee when creating a transaction?
TX fee = UTXO Output - UTXO input
- When your privat key has money attached to it. Your balance is total number of UTXOs.
- Transaction would fail.
- Looks at the network and suggests fee that would make the transaction happen in a reasonable time.
- Send all of your transactions to multiple addresses. Can send to other addresses you own to make it harder to follow.
1- UTXO is the output of the blockchain transaction that has not been yet spent.
2- if any single UTXO is not large to cover for your transaction, the wallet will use another UTXO until the UTXO is enough to cover the transaction.
3-Input-output=transaction fee
4-using different addresses
1- UTXO are transactions received from an external source or a sender that can be tracked by a wallet
2- If the sum of UTXO is less than the requested transaction, it fails
3- The wallet estimates the fee by checking the fees of previous transactions on the blockchain using the formula input = output + fee
4- Bu using multiple inputs and outputs (aka keys)
You forgot to answer the final question 
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Describe what Unspent Transaction Outputs (UTXO) are.
A: These are incoming transactions (tx) into a wallet that haven’t been spent yet. They are seen as outputs from the sending wallet and basically become an input into the receiving wallet ONCE that particular user decides to create a new tx. They reside in the new wallet as an UTXO until a new tx is created. -
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
A: In this situation the wallet will query the blockchain and pull all UTXO’s for that associated private key and then will add them all up. The wallet will create the transaction, sign it and broadcast it out to pay for the transaction in question. Inputs = Outputs + tx fee. -
How would a bitcoin wallet specify the transaction fee when creating a transaction?
A: The wallet will look at the previous fees on the blockchain and propose a fee that will get that transaction into the blockchain in a reasonable amount of time. Although when specifically determining the fee, Ivan mentions that its the sum of inputs minus the sum of the outputs. But this doesn’t make sense to me since for example using his example in the lesson: If I had UTXO (inputs) in my wallet of 0.5 & 0.4 (total of 0.9) and I was wanting to buy something worth 0.7, the principle that inputs = outputs would mean that after paying the 0.7, I would have 0.2 coming back to my wallet. So if fees were based off the difference between total inputs minus total outputs the fee would be zero, since those two things equal out. I’m still not sure how the fee amount is exactly determined. Can anyones provide a further explanation? Thanks! -
How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
A: No one can tell who is sending and receiving the funds since its just a crypto/BTC address that these transactions are being allocated to. So it keeps things anonymous and thus private.
thank you. yes you are right. So I wouter say that since a person can use any number of addresses, transactions cannot be uniquely assigned to a person.
- UTXO shows unspent balance someone has.
- In that case wallet will use multiple UTXOs (if you have) to cover the transaction and give you ‘Change’ so to say.
- Some wallet automatically calculate the transaction fee, and some allow you to choose it. It will affect the speed of your transaction.
- Create and use new wallet addresses for your transaction might increase privacy. Bitcoin is open ledger and created to track every transaction on chain forever. All btc mixers getting ‘unmixed’ eventually :))
1 UXTos are the balance left in your wallet
2 The transaction would be cancelled
3 UXTOs minus UTXO input = fees
4 Use a private block chain
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UTXO’s are the inputs to any new transactions that occur. They hold the previous information in the blockchain leading to their current state and also hold part of a public key which associates them to a wallet or private key that allows them to be spent.
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If you do not have any one UTXO large enough to cover a transaction you could use multiple UTXO’s as inputs provided you had more available. If you do not have more UTXO’s available from that particular wallet than the transaction should fail I would think.
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A bitcoin wallet would look to the blockchain and based on the previous transaction fees of the latest transactions, it would calculate a rate that should get added to a block in a reasonable amount of time. Some wallet may even give you different speed options for trading, etc. which may further incentivize miners to add your transaction or save you btc if you don’t really care when the transaction gets added.
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You could repeatedly send yourself small portions of BTC to breakup your UTXO’s even farther so when you do finally transfer your BTC to someone else there are so many inputs and outputs it would be very difficult for an outsider to read the inputs and outputs and decipher what the true transaction had been.
The fee is implied by the remainder of inputs and outputs. If you would pay 0.7 BTC and send back 0.19 BTC from your example, 0.01 BTC would be considered as a fee to the miner.
What about when you withdraw from an exchange where you did KYC?
You can achieve a degree of privacy on Bitcoin by using a new address every time you receive funds. 
- the total balance left in wallet that keeps track of…
- will use more than one UTXO
- wallet check the blockchain and figure out the fees
- many inputs and outputs. and use different address