Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#2697

1.UTXO are the bitcoins that are received by the recipients but not used or sent yet
2. transactions won’t go through
3.the bitcoin wallet will specify the transaction fee. input = fees + output
4.Anonymity is preserved naturally by the bitcoin transactions as the output can be sent from varies peers or network without specifying the users personal information.

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#2698

  1. UTXO’s are the BTC you have available to spend. They are the outputs of previously received transactions, which have not yet been used as inputs in subsequent transactions (hence “unspent”).

  2. Multiple UTXO’s would be used as inputs for that transaction.

  3. Fee = Inputs - Outputs, therefore, any remaining value, after the sum of specified outputs, is the amount allocated as the fee.

  4. You could set up multiple wallet accounts and include outputs that are routed to those accounts.

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#2699
  1. Describe what Unspent Transaction Outputs (UTXO) are. They are what they call a normal transaction which is a transaction where you pay yourself the remaining balance after you paid whoever you are paying minus the fee.
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction? The transaction will not be possible.
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction? It will construct the transaction and will look at the recent blockchain transactions to determine the fee proposal.
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction? It is done utilizing your private key so there is no need to share your personal identity or personally sensitive information with whoever is on the other end of the transaction.
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#2700

One can know your bitcoin address, can you figure out what to do in that case? :wink:

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#2701

UTXOs are Unspent tx Outputs, which are outputs you received and have not spent yet, the sum of UTXOs represents your balance.

What about if someone knows your address? :wink:

#2702

Homework on Bitcoin Transactions and UTXO - Qs

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    It is the balance that is unspent in your wallet

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    The transaction will not go through.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    The fee is calculated by input= Output-Transaction fee.
    Miners will also suggest a fee which allows faster transaction time for the transaction to be added into the block

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction? You can have several addresses you control for the input of transactions and also in the output of transactions

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#2703
  1. That are not spended transactions that you recieved from else that are waiting to be spended.
  2. It can combine multiple UTXOs to cover the transaction. But iff i don’t have enough UTXOs to cover the transaction then it will fail Then the transaction will fail.
  3. input - output = Fee the wallet it self makes the most reasonable calculation of the fee cost
  4. I would say that there is also already a lot of privacy on my transaction because my name is not hanging on a transaction. Butt what you could do is use more outputs that will make it more difficult.
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#2704
  1. Describe what Unspent Transaction Outputs (UTXO) are.
    The total unspent balance in your wallet.
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    Combine and use more them one UTXOs to complete the transaction.
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    It is the difference between the inputs and the outputs. Its is not specified anywhere.
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    By generating new addresses when receiving something.
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#2705
  1. UTXOs are digital transactions you have left after executing another transaction.
  2. the wallet will add all your UTXOs, pay for the transaction fees and the remaining balance will come back to your wallet as a new UTXO
  3. Tx fee = inputs - outputs and bitcoin users set their own transaction fees manually with each outgoing transaction
  4. by braking down your transaction into smaller ones or by combining multiple transactions into one you can mask the transaction history
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#2706

That would be expensive and I’m not sure how it would help. You could just use a new address every time you receive funds. :slight_smile:

#2709

so what does kyc excacly do ? does it link some kind of id to the adress on the exchange ?

#2710
  1. Unspent Transaction Outputs are the transactions one receives and serves as input. The total UTXOs I receive is calculated by my wallet which then becomes my balance.
  2. Your transaction will not go through.
  3. Fee is equal to Input minus Output.
  4. By the use of more than one bitcoin wallet address.
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#2711
  1. These are the recieved transactions
  2. A wallet would choose a couple of UTXO’s that can be added to cover the transaction
  3. It would check with the blockchain and see recent transaction fees
  4. Use a couple of adresses, make many outputs
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#2712

I guess i will transfer all funds to a new one with a different bitcoin address?

#2713

Have you ever did a KYC?

It links your identity to all addresses you withdraw from the exchange.

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#2714

If you would just send to a new address, one could still predict it might be yours. You could pay to someone a service and send the change to a new address. :slight_smile:

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#2715

  1. Unspent Transaction Outputs are your wallets balance(how much you can spend). These are tracked by the blockchain.

  2. If there are other UTXO’s they will be combined and you will get “change” back. If there are no other UTXOs to combine the transaction will be invalid.

  3. Wallet automatically calculates this which will be the Input - the output.

  4. Sending the transaction to multiple outputs some of which are yours with a different address.

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#2716

I see. Thanks a lot for the tip

#2717

Kyc = know your customer, exchanges want your name, address emailadres etcetera to link this Information to your Wallet. So this exchange knows everything you do. if you want to be anonymous, you need to create and use your owns keys to transact. (better even running your own node) But this gives you 100% ownership. And if you forget your private key or mnemonic phrase, nobody can help you. So it’s a lot of financial technical responsibility to be self sovereign and have financial freedom.

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#2718
  1. Describe what Unspent Transaction Outputs (UTXO) are.
    balance left in your wallet
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    transaction will be declined, or in other words transaction will fail
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Wallet gives estimate itself (in some wallets you can adjust your self) fee connecting with blockchain
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    generate multiple corespondent addresses for outputs
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