Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#3864

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

#3865

Thank you very much for the correction, I think I should stop thinking about the multiple UTXO’s as one.

#3866
  1. Unspent Transaction Outputs (UTXO) express the funds you have available (expressed in cryprocurrency coins) that you can spend
  2. If you don’t have any single UTXO that is large enough to cover for your transaction, your wallet will use as inout additional UTXO’s as input and include a ‘refund’ back to you, for any partially-spent UTXO’s
  3. A bitcoin wallet specifies the transaction fee, by selecting/calculating the ‘optimal’ fee
  4. Transaction inputs and outputs maximise privacy and confidentialy by only using cryptocurrency addresses in transaction inputs and outputs
2 Likes
#3867
  1. An unspent transaction output or UTXO is the amount received from a transaction which is now available to spend.
  2. If a single UTXO is not large enough to cover the transaction plus the fee, then multiple UTXO’s belonging to the same wallet can be added up and used to cover the cost and what remains will be sent back as change. If the wallet just has a single UTXO, then the transaction will be rejected by the network.
  3. I’m not sure but I think it has to do with bytes used and how much traffic is in the network. If someone has an answer, I would appreciate it.
  4. Never use the same address twice
1 Like
#3868

  1. A UTXO is a received transaction, as long as it is not spent.

  2. The transaction would not go through.

  3. Some wallets let you choose the fee and others pick the one that will get your transaction through the fastest.

  4. I guess having multiple wallets (?)

1 Like
#3869
  1. A UTXO is an input that doesn’t yet have an output. That is the amount of UTXO in a wallet is the balance of the wallet
  2. The network would reject the transaction
  3. The wallet would add the txn fee onto the outputs to equal total the number of UTXOs (equal inputs)
  4. If you had more outputs that would help hide the direction of the TXN. All the outputs could even belong to you.
1 Like
#3870
  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTO is the unspent portion of what is sent to 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 process
    3.What would happen if you don’t have any single UTXO that is large enough to cover for your transaction? It uses the difference between the input and putput
    • How could you use the notion of transaction inputs and outputs to increase privacy in your transaction? By using different addresses
2 Likes
#3871

1. Unpsent transaction outputs are the funds that have been sent to the owner from one or multiple wallet addresses, The sum of UTXOs is the Balance of the owner of certain wallet address.

2. if one UTXO is not enough to cover the transaction, then multiples of UTXO are combined to cover the transaction. The transaction will not happen if the sum of UTXOs are not enough to cover the transaction.

3. Bitcoin wallet will calculate the differences between the input and output to get the transaction fee, Input = Output + fee. in some cases the wallet will calculate the transaction fees depending on a percentage of the input transaction.

4. By having multiple transaction inputs and transaction outputs, transaction outputs could be multiple addresses of the same owner of the input transaction. By repeating this process multiple times we can increase the privacy of out transactions.

1 Like
#3872

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

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

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

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

  5. Basically UTXOs are transactions you can spend .

  6. The blockchain will check your UTXO first and after noticing that you don´t have enough founds, it will decline your transaction.

  7. Input = Output + Transaction Fee , so basically Input - Output = Fee
    4.You can create many outputs and nobody would know where you have sent your coins.

1 Like
#3873

You must always spend the entire UTXO (use as an input to a new tx). You will get a new UTXO back as change. :slight_smile:

#3874

The fee is implied as the difference between inputs and outputs - input - output = fee :slight_smile:

#3875

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

1 Like
#3876

Thank you :smile: @Alko89

#3877

  1. Utxos are values that we didn´t spend yet.

  2. more than one utxos would combine to complete the amount that is needed + the transaction fee.The leftover amount could be send back to my own account or another account owned by me.

  3. nobody knows that the adress belongs to me

1 Like
#3878

What about in case when you withdraw funds from an exchange where you did KYC? :wink:

#3879

Thanks for your replies mate they are very helpful.

I have one concern.

Trusting my wallet with regards to fees… Does this potentially mean that I could make a transaction and some kind of glitch, or even just an innocent misjudgement by my wallet could result in a humongous transaction fee?

Could such a thing potentially happen and even wipe out a huge amount of someone portfolio?

Thanks again.

I’ll look forward to your reply.

#3880 
 1. Unspent transactions outputs UTXOS you haven't spent . They remain in your wallet. 

 2. The wallet will calculate how much UTXO's you have, if not enough 
     the transaction will be denied.

  1. Wallet search’s the blockchain for the best fee in some cases you can choose fees.

  2. Users are encouraged to use new addresses for every transactions, improving privacy to some degree

1 Like
#3881

i didnt thought about that, thanks :slight_smile:

#3882

  1. UTXOs are essentially funds that belong to a specific wallet address. Once those funds are sent from that address to a new address, they become “spent” transactions.

  2. The Transaction will not be verified and not added to the blockchain if the funds to cover the transaction are not available.

  3. Inputs = UTXOs (Outputs) + Transaction Fee

  4. You could be sending part of the UTXOs back to yourself, but to a different address or Wallet that is not the same but still controlled by you.

1 Like
#3883
  1. UTXOs - are the inputs to a wallet.
  2. If you don’t have a UTXO large enough to cover a spend transaction then the transaction will not be able to be executed.
  3. UTXO- input = fee
  4. I would make try to make sure the input addresses are distinct from the output addresses.
1 Like