Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#3784
  1. Describe what Unspent Transaction Outputs (UTXO) are.

Unspent transaction outputs are the outputs from transactions associated with a certain address that are waiting to be spent by that address. Once they are spent, they become UTXOs for the address that receives the transaction.

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

The transaction would be declined by the nodes within the blockchain ecosystem.

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

It would refer to the blockchain and recommend a fee based on recent transactions.

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

It is impossible to know the parties involved in the transaction just by looking at the blockchain. The users could even send the bitcoin to themselves.

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#3785
  1. UTXOs are outputs of previous transactions that haven’t been spent by a its holder.
  2. If you have many UTXOs that together can cover the desired value of your transaction, they can be used together and the rest will get back to you (less transaction fees).
  3. When creating a transaction a wallet will recommend the fee to include according to how the blockchain is performing in that moment. At the end, Fee = Input - Output
  4. By using multiple inputs and outputs it is harder to track who is the real holder of each UTXO
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#3786
  1. UTXOs are funds in your wallet that you have the ability to spend, but have not yet been spent.
  2. If you don’t have any single UTXO that is large enough to cover for your transaction, it will not be sent.
  3. The transaction fee is calculated by the difference of inputs and outputs.
  4. By sending it to many different wallets that you have control of.
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#3787

Homework on Bitcoin Transactions and UTXO - Questions

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXOs are inputs from from old outputs from previous transactions
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    The wallet will sum up all all UTXO and try to generate a balance large enough to send to create the transaction amount desired, but if not enough UTXO can be accumulated, the transaction will not be validated by the network.
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    The transaction fee is always transaction input minus output. Fees may be chosen manually for any specified purpose, but generally the wallet generates the fee for you based on the difference between input and output.
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    You can send UTXO to several different addresses you own, making it difficult to know who has the private keys to that particular address.
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#3788

In almost every country every form of income is taxed. That they did not ask before, doesnt mean you didnt need to pay tax on it.
Whether it is fair or not unfortunately does not matter. One could argue that it is not fair on other types of income either, but they’ll still stick you in jail if you dont pay it :frowning:

#3789

Ha ha! Very true! Don’t worry, I’ll be paying my taxes. :grinning:

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#3790

Dont worry i wouldnt tell anyone :smile:

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#3791

There are a few of them out there, I mostly use crypto.com, there is also Plutus, Monolyth and others (I can give you my refs :stuck_out_tongue: )

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#3792

You can use multiple UTXOs as inputs to a new tx. If you still don’t have enough then your tx would be declined. :slight_smile:

#3793
  1. They are addresses with balances that can be used/spent in future transactions.
    2, The transaction will not be processed.
  2. It specifies it by Satoshis/Byte.
  3. It sends each out put into another address.
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#3794
  1. UTXOs are inputs that we can spend.
  2. It`s not about A single UTXO. You can use many singles UTXOs to cover the Tx.
  3. Tx fee = input - output.
  4. Sending UTXOs to “yours” different address
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#3795
  1. UTXO are the output from previous transactions and they indicate the amount received and now that amount can be spent
  2. The wallet will sum more or all your UTXO to cover the transaction, if you don’t have enough UTXO the transaction can’t be covered.
  3. In some wallet you can specify the fee you want to pay. In others bitcoin wallet, the wallet will check previous fee that have been paid and automatically ask if you agree with the fees that allow your transaction to be fast enough.
  4. By increasing the number of the outputs.
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#3796

[quote=“ivan, post:1, topic:8436, full:true”]
Homework on Bitcoin Transactions and UTXO - Questions

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    Basically, it’s the amount of leftover cryptocurrency change that you receive from each transaction.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    no transaction will occur if the UTXO is not sufficient .

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Transaction fees are included in transactions and subtracted from UTXO that’s you receive as change .
    Sum of UTXO in the transaction - Transaction amount - transaction fee

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

Multiple users combine all inputs and outputs from several transactions into a single, big transaction. This single transaction spends bitcoins from different addresses to different addresses – and since none of the sending addresses pay none of the receiving addresses specifically; there’s no link between any of them.

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#3797
  1. Describe what Unspent Transaction Outputs (UTXO) are.

UTXOs are unspent transactions. They are the transactions which, when added together, will give you your spendable balance.

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

If you don’t have one single UTXO that is large enough to cover one transaction then the TX will be rejected unless you have other UTXOs that you can add onto this one to c
over the TX. The correct amount will be sent to the desired wallet address. One the TX fee has been deducted, you will then receive the balance back to your desired wallet address.

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

The wallet will look at recent TX fees to determine a fee that will get the TX onto the blockchain reasonably quickly. Some wallets like Metamask allow you to choose your TX fee so that you can speed up this process if you wish.

  1. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    By using a different wallet address to the input address. No one will know wether the sender also received any BTC in the4 same transaction as they wont know who owns that wallet address.
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#3798

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    Are bitcoins transactions, input, that have entered the wallet but have not been spent

  2. 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 valird or will fail

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    it is TX input - TX output

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    By genersting multiple outputs transactions it is difficult to find out which ones goes back to the sender and therefore increase privvacy

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#3799
  1. UTXOs are the amount of BTC that you have received in your wallet that hasn’t been used for an output transaction yet.
  2. Your wallet would combine multiple UTXOs to cover the transaction. You would then receive the remaining balance.
  3. BTC would combine the TX fee in the total Output of the TX. The total output would contain the TX fee.
  4. When looking at the addresses, an outsider cannot tell the if you are sending money to two different people or if your receiving ‘change’ back from a transaction in which you had to use multiple UTXOs to fulfill the output.
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#3800

Awesome! Thank you! I’m very interested. :smiley:

#3801

1. Describe what Unspent Transaction Outputs (UTXO) are.
They are transactaions send form wallet A to wallet B, but are not spend by wallet B / private key B yet.
2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Transaction would not be processed by the miners.
3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
The wallet evaluates the fee out of previous transactions inside the blockchain and select a specific fee to achieve an acceptable processing time on the miners side.
4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
You could simply add more output addresses which belong to yourself.

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#3802

You can use multiple UTXOs as inputs to a new tx. If you still don’t have enough then your tx would not be processed. :slight_smile:

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#3803

1 utxo are inputs in a transaction which provide balance of unspend transactions(available bitcoins)
2 it will be taken from second utxo and combined and the change will be returned minus fee
3 it looks on the network congestion and specify the correct fee necessary for optimal transfer speed
4 use different address for every receiving transaction

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