Thanks! I thought this was a manual process we have to do for each transaction, but if the wallet itself handles this then I have nothing to worry about.
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Describe what Unspent Transaction Outputs (UTXO) are.
It’s the input that someone sent you to your wallet and has not been spent yet. -
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
You need to find another UTXO that when combined with the other UTXO can pay for the transaction and the rest or the extra BTC can be sent back to yourself. -
How would a bitcoin wallet specify the transaction fee when creating a transaction?
The wallet does this by looking at the blockchain and automatically figures out a fee for a transaction. -
How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
It is hard to tell where the output is from and where it is going because it is encrypted.
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UTXOs are the outcomes of transactions (outputs) expected to be used (Spent Transaction Output) in the form of inputs on new transactions.
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A combination of UTXOs that is equal or larger in size than the total cost of the transaction (all transaction outputs + transaction fee) is needed to be used for the transaction to be validated on the Blockchain network in question.
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Checking the bitcoin blockchain for recent transaction fees and choosing a fee that will allow the new transaction to be validated on the blockchain relatively fast.
The wallet will also select its UTXOs required to cover all outputs and the fee of the new transaction for it to go through. -
Distributing the amount to be received from the transaction on different transaction outputs (one address for each output).
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- the amount that you want to spend from the input that you received previously
2.the transaction would be rejected or use more UTXOs if available
3.the input minus the output - from the outside no one can tell who sends and who receives , only random numbers created with the help of sha256 hash functions
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#1 Unspent Transaction Inputs are the sum of inputs received that are recorded on the blockchain that are not yet “spent”. These are the wallet “balance” for a given crypto. These become inputs when a sender sends Bitcoin, for example to another address or set of addresses. Wallets query the blockchain to determine how many UTXO’s a given private key has and adds them up to determine the wallet’s balance for a given crypto.
#2 If you don’t have a single UTOXO large enough to cover your transaction, one of two possibilities:
If you have several UTXO’s that in the aggregate are sufficient to cover a transaction, the transaction will be processed by sending the excess of UTXO’s over 3rd party address amounts received plus transaction fees back to your own address. If the sum of UTXO’s is less than aforementioned, the transaction will be rejected.
#3 Bitcoin wallet would query the blockchain to see what level transaction fees are currently and then set a fee sufficient so that a transaction will be processed in a reasonable amount of time - say within time to add 3 or 4 blocks
#4 Make sure you use multiple addresses when receiving a crypto at different times to your wallet.
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You can see the full transaction with addresses. The tx hash is just used as a txid. 
- UTXOs are the bit coin which some one send me but I didn’t put in my wallet yet.
2.you can combine all or more then 1 of your UTXo
3…input - output= tx fees
4.generate new addresses for outputs
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- Unspent Transaction Outputs are inputs that have not been spent yet by you. The available coins you could use/spend.
- It will look for other UTXOs and use them as well. If there are no more UTXOs and the total is not large enough to cover the transaction, then that transaction will not be constructed.
- Fees = Input - Output
- Using many receiving and sending addresses
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Unspent transactions are transactions that represent a net gain for a wallet address. In other words, this is the net result of a transaction after subtracting any amount that goes to other addresses.
If there is not one unspent transaction large enough to cover a new transaction request, then several unspent transactions can be combined to see if there are sufficient funds.
A wallet can calculate the fee by subtracting the total input from the total output for a transaction.
Using multiple wallets or addresses can be a way to disguise a transaction.
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1 is the balance available on the ledger resulting from previous transactions
2 it will be impossible to make the transaction due to the fact that the ledger eliminates the double spending
3 it will look at the previous fees on the ledger for transactions and suggest the fee in order to transfer the funds in a reasonable time frame
4 use of different wallets and split uneven transactions at different times so even if you look at the ledger you cannot see a lump sum in one wallet
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that´s right you can see the full transaction with addresses but you can´t see who actually owns the sending or receiving addresses and that increases the privacy
“How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?”
UTXOs are Unspent TX Outputs. A transaction can have many outputs so UTXOs are just a part of a tx structure.
You can use multiple UTXOs as inputs to a new tx.
You can use a different address each time you receive funds or send change back to yourself. From the tx outputs it is then impossible to determine what part of the tx went to pay the service and what went back to yourself.
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- Describe what Unspent Transaction Outputs (UTXO) are.
- A UTXO is the amount of digital currency that is remaining unspent after executing the cryptocurrency transaction. A transaction is marked as spent when another different open transaction has used the UTXO as an input. A transaction can have one or more UTXOs and their sum represents the wallet’s balance.
- What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
- The question refers to a single UTXO. In this situation, another UTXO(s) will be added if available, until the transaction value will be met. If there are no other available UTXOs to be summed up, the transaction will be invalidated.
- How would a bitcoin wallet specify the transaction fee when creating a transaction?
- In a transaction, the sum of inputs equals the sum of outputs plus the transaction’s fee, so the difference between the total of inputs and the total of outputs represents the transaction fee.
- How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
- Since the transaction inputs and outputs are targeting addresses in the blockchain, the privacy can be increased by creating more outputs to different additional addresses while the transaction initiator is the same owner of the additional addresses.
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unspent transaction output is money that you have in your bitcoin wallet that was sent to you and you recieved and is in your wallet, that you have NOT spent.
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you wouldnt be able to send that amount, assuming you would have to send less, to make up for that single uxto.
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the bitcoin wallet would specify the fee when creating a transaction because, that bitcoin you have on your wallet’s private key is connected to the network that its from and from there it msgs the nodes and tells them that, this transaction is being made sends that message to the miner to confirm and creates the block and the miner takes the fee and send it into the blockchain and from there you have the fee, and the wallet makes the so called “best decision” for you where fees are concerned. some wallets give you the option to decide while others make the decision automatically. when this “best decision” is made its usually the most expensive option the miner takes the fee processing it the quickest to get to you.
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- Describe what Unspent Transaction Outputs (UTXO) are.
It’s the available money that you have in your wallet. - What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Transaction can’t go through. - How would a bitcoin wallet specify the transaction fee when creating a transaction?
New UTXO = (sum of UTXO in the transaction) - Transaction amount - Transaction fees.
How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
Use multiple addresses
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UTXO are the sum total of bitcoin that a user controls.
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The transaction may use more than one UTXO to cover the amount needed to cover the transaction.
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The transaction fees would be equal to the sum of inputs minus the sum of outputs.
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A person could obfuscate how much bitcoin they control by sending a portion to another wallet they also own, during a transaction.
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Describe what Unspent Transaction Outputs (UTXO) are.
It is the sum of a leftover currency after a transaction. In other words, it is like receiving change after spending a fiat currency such as the dollar, yen, euro, etc. -
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Your wallet will sum up as much unspent UTXO’s to cover the transaction. If there is not enough UTXO’s the transaction will be non-valid. -
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?
By changing output addresses.
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Describe what Unspent Transaction Outputs (UTXO) are.
The sum of all currency received in your wallet that has not yet been spent; HODL bag. -
What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Unspent outputs from multiple transactions can be combined, but total sum of all UTXOs for the wallet must be greater than the outgoing transaction. -
How would a bitcoin wallet specify the transaction fee when creating a transaction?
The difference between the transaction input and output will equal the fee. Can be increased to incentivize a quicker transaction. -
How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
A transaction can be split among many wallets and any portion that exceeds the total UTXO amount will be sent through the network and back to the wallet of the sender. This makes it much more difficult to see who controls the funds just by looking at the transactions on the blockchain, as its not a simple A to B transaction.
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