Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#3040
  • Describe what Unspent Transaction Outputs (UTXO) are.
    UTXO – unspent transaction output. An unspent transaction is a fraction output from the last transaction, to be spent, fractionally, in the next transaction
  • 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 accepted by the given crypto network. Because, Input = output + transaction fees. There must be enough input for transaction fees. Trxt fee = input - output
  • How would a bitcoin wallet specify the transaction fee when creating a transaction?
    by deciding the input to choose, and which outputs to create: it will pick the fee it thinks it’s best that increases the probability that the transaction will get into the blockchain quickly. Trxt fee = input - output
  • How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    viewing a given crypto explorer, the inputs are expressed on the right, while the outputs are expressed at the left. Having more than one output expressed, along with the fees, it is difficult to determine which expressions are going back to the authorizing wallet as a UTXO
1 Like
#3041

1.UTXO is the output of a transaction which cross references with you private key to determine the balance available or funds available to that specific wallet and yet to be spent.
2.If you need to make a transaction that is greater than any single utxo then more will be added and any remaining balance from the transaction would be returned back to a wallet controlled by the original owner.
3.The transaction fee would be specified by taking the input value and subtracting the output value.
4.As bitcoin inputs and outputs are just strings of alphanumerical characters they are not specifically attached to an individuals identity and so an individual can have many addresses they are in control of which wouldn’t be apparent and could have access to many of the outputs transactions.

1 Like
#3042

  1. UTXO’s are essentially the inputs or implied balance in your wallet from another wallets output.

  2. You will not be able to make a transaction.

  3. The transaction fee is implied or more specifically it is the difference between the input(s) and the output(s) of a transaction.

  4. You can increase your privacy by using multiple output addresses in a transaction of which you control.

2 Likes
#3043

1. Describe what Unspent Transaction Outputs (UTXO) are.
UTXO (Unspent Transaction Output) are Transactions you received and can be spend.

2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
The wallet will add as many UTXOs until the amount for the transaction can be covered. If there are not enough UTXOs at all, the transaction cant be done.

3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
The Wallet creates a reasonable fee (market-based). (Transaction Fee = Input - Output)

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
Because new adresses get created. Therefore, it is hard to see which output goes back to the sender.

2 Likes
#3044

1)UTXO’s are the unspent transaction outputs from previous spending.

2)Transaction would be denied.

  1. Subtract the input from the output and that is the fee.

  2. You could use multiple addresses. The inputs/outputs never show personal information so the more inputs/outputs you have the harder it is to track.

2 Likes
#3045

[quote=“ivan, post:1, topic:8436”]

  • Describe what Unspent Transaction Outputs (UTXO) are.

I think UTXO is the transaction that doesn’t get accepted by nodes yet.

  • What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?

The transaction doesn’t get aprobation and it gets cancelled.

  • How would a bitcoin wallet specify the transaction fee when creating a transaction?

It’s the difference between input & output.

  • How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?

You have to create new adress everytime to get your info straight.

1 Like
#3046

Continuing the discussion from Homework on Bitcoin Transactions and UTXO - Questions:

  1. UTXOs are addresses controlled by a private key with unspent funds from which the wallet will keep track and construct the transactions from. New UTXO are used for change as well.
  2. The blockchain will simply refuse to include the transaction, perhaps the wallet won’t let you broadcast it.
  3. The wallet will check with the network for the average transaction fee being paid in order to include the transaction in a reasonable time. Some wallets let you select the fees therefore the transaction priority as well.
  4. The wallet will automatically send the change to a new UTXO but you can use several addresses for input and output to increase privacy.
1 Like
#3047

UTXOs are Unspent TX Outputs. Meaning they are the outputs from transactions that have not been used as an input yet. The sum of them represents the wallet balance.

You can use more UTXOs as inputs to a new tx. If its still not enough, the tx will fail. :slight_smile:

1 Like
#3048

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXOs are received inputs from e.g. your mom, dad, sister, that you have in your wallet now and that you can spend now

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    Then you can’t do any transactions

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    You will see the difference between your input minus your output, it will be a reasonable market price fee

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    *You can use differente inputs an outputs addrsses *

1 Like
#3049

  1. UTXOs are funds that you have been sent but have not yet spent, so they are your funds and together they represent your available balance.

  2. Your wallet would use any number of UTXOs to make up an amount that is large enough to cover your transaction.

  3. A bitcoin wallet will suggest a transaction fee automatically. The fee will be enough to get your transaction into the blockchain reasonably quickly, based on fees for previous transactions.

  4. It’s possible to have any number of inputs (UTXOs) and outputs (wallet addresses) within a single transaction. Since inputs and outputs are always equal (fee included), any unspent bitcoin is returned to you, like physical change using currency. This change can be sent to multiple addresses that all belong to you to increase anonymity.

1 Like
#3050

Describe what Unspent Transaction Outputs (UTXO) are.

  • Unspent UTXOs are the funds that you have received in your wallet = from a previous transaction
    What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
  • Your transaction will be declined due to insufficient funds.
    How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Fee = inputs - outputs .
    How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
  • You can use various addresses to send funds to.
2 Likes
#3051

Thanks for the correction :smiley:
I’m totally new at this and it’s nice from you!

Thank you so much!

#3052

Homework on Bitcoin Transactions and UTXO

  1. Describe what Unspent Transaction Outputs (UTXO) are.
  • the UTXO’s are the total remaining balance in a wallet.
  1. 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 validated by the wallet, nor would it be accepted by the miners.
  1. How would a bitcoin wallet specify the transaction fee when creating a transaction?
  •  fee = input - output
  1. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
  • By having several different addresses in an input.
1 Like
#3053
  1. Describe what Unspent Transaction Outputs (UTXO) are.
  • Unspent Transaction Outputs are what the multitude of Blockchain nodes keep track off. These UTXO’s represent the amount of unspent Sats that came from previous Inputs
  1. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
  • Your wallet would sum up all the previous UTXO inputs that you’ve received and determine whether you have enough total UTXO’s to spend as an output which would then be unlocked and become spent UTXO while creating new UTXO’s which reflect the new amount of unspent outputs deducted from the spent ones that become new inputs
  1. How would a bitcoin wallet specify the transaction fee when creating a transaction?
  • Some wallets may allow you to indicate the amount you want to set as transaction fee. In most instances the wallet will be the one to determine the amount of this transaction fee by looking at the blockchain for other transactions and previous transaction fees in order to ensure that your transaction will be incentivized enough to be picked up by miners in a timely manner.
  1. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
  • One advantage of the UTXO model is in the area of privacy. As it is quite a challenge to keep track of which transactions or UTXO’s go to which party, the recipient or back to the original sender’s address. It’s so vague in fact the way these transactions are accounted for and attributed that the blockchain explorers can only abstract this data in their database.
1 Like
#3054

You don’t need to sum up al UTXOs, you can only pick as much as you need to fund the tx. :slight_smile:

1 Like
#3055
  1. UTXOs are the unspent amount in your wallet.
  2. The transaction will not be successful.
  3. The wallet will compare previous fees on the blockchain to recommend a fee for the transaction.
  4. You could make use of a number of different addresses to secure anonymity.
1 Like
#3056

UTXOs Questions:

  1. UTXOS are all those outputs, which are yet to be unlocked by their inputs.The unlocked outputs are removed from circulating supply and new outputs take their place. The sum of values of newly created output will always equal to the sum of the newly created output. (ignoring transaction fees)

  2. If you do not have any single transaction that is large enough to cover your transaction, your wallet will automatically search for your utoxs, input them into the transaction, produce an output that will fulfill the order and sends back the change to the user minus the transaction fee.

  3. Bitcoin specified the transaction fee by implying ie that it is included in the output. For example. When an output that has a value say $20, but creates a new output that has a value of $15.The missing $5 is the transaction fee. This is the fee that is paid to the miners for inclusion of the transaction in a particular new block. The higher the fees the higher chance of inclusion in the next block.

  4. The notion of input and output to increase privacy in a transaction is that different UTXOs in different addresses on the blockchain, that is connected to the address in your wallet, can be used by your wallet on both the input and output to conclude transactions. This gives anonymity and avoids tracing back to find who the user is.

1 Like
#3057
  1. Coins you received but did not spend yet.
  2. You combine smaller ones until you get the desired amount and any left overs will be send back to you minus the fee of course.
  3. It will look at the previous fees on blockchain and suggest a fee that will be reasonably quick. the math: input = output + fee
  4. You can send coins from one address to another and control both.
2 Likes
#3058

1.) Describe what UTXO’s are.

 A UTXO is the sum of all unused/unspent transaction outputs in the wallet to be spent later.

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

 The transaction would be invalid and cancel out.

3.) How would a bitcoin wallet specify the transaction fee when creating a transaction?

 The fee isn’t specified, but implied.  Input - Output = TX Fee

4.) How could you use the notion of transaction inputs and outputs to increase privacy in your
transaction?

 By increasing the number of outputs to different wallets and wallets that you own too.
1 Like
#3059

Homework on Bitcoin Transactions and UTXO - Questions

Q1: Describe what Unspent Transaction Outputs (UTXOs) are.
A1: UTXOs are the records of transactions on the blockchain that are available to be spent (made into a new input/transaction) and they are linked to a specific private key. Each UTXO must be spent in entirety as there are no fractional UXTOs. If you have a UTXO worth 1 and want to buy something that is worth .5, you will send .5 to the recipient and .5 back to yourself.

Q2: What would happen if you don’t have a single UTXO that is large enough to cover your transaction?
A: Your wallet will combine as many of your UTXOs to cover the transaction. It will combine them, send the transaction amount to the recipient, and the remainder back to you.

Q3: How would a bitcoin wallet specify the transaction fee when creating a transaction?
A3: Wallets specify it as the input minus the output. The fee amount is determined either automatically by the wallet looking at the blockchain’s previous fees for similar transactions and the fastest confirmation time or manually set by you the owner.

Q4: How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
A4: Since the transaction input is Hash-256 and the output is Hash-256, you are unable to tell from the identification number if the recipient and the sender are different people/addresses or the same.

2 Likes