Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#4205

  1. UTXO’s are the unspent amount of a previous transaction(s), and will always be equal to the amount sent, minus fees.

  2. If there are insufficient funds in a single UTXO, the transaction will simply not go through, unless there are multiple UXTO’s to make up the difference. One must also take fees into account as well into their amount decision.

  3. The wallet will take into account the fee before the transaction is made; it will choose the fastest route for your transaction, but some wallets will allow you to choose the fee for yourself.

  4. Just like conventional banking, having multiple accounts keeps your finances spread out and harder to track down. The security that blockchain brings via hash functions and verifications make this more so.

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#4206
  1. UTXO’s are the outputs of a previous transaction, your UTXO’s are outputs of a previous transaction that where sent to you, that you have not yet sent to someone else.
  2. The wallet would sum all the UTXO’s that belong to you and send the combination, with the differenc (minus a fee) being returned to you.
  3. The fee is assumed as the missing value of the total outputs. This value is created by the wallet based on previous fees from previous transactions.
  4. By increasing the number of outputs in a transaction since the owners of the outputs cannot be known you could be sending outputs to other wallets that you also have access to. Theoretically you could also only use a private key only once, since each transaction must move ALL your UTXO’s. technically speaking before your wallet recieves a new UTXO from yourself it is empty. if you pointed the balance each time to a new wallet then your old wallet would have a balance of 0 and could be abandoned??
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#4207
  1. the amount of the input that hasn’t been spent.
  2. the transaction would fail
    3.the wallet decides what is the best fee level and gives you options.
  3. You could use different addresses that go to the same recipient or send outputs back to yourself but to a different address.
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#4208
  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXO’s are unspend transactions you received on your wallet.
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    Your wallet is going to combine multiple UTXO’s to cover for the whole transaction.
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    INPUTS are the sum of OUTPUTS + TRANSACTION FEE , so the FEE is the difference between the INPUTS and OUTPUTS. The fee is going to be implied in the transaction.
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    You can use multiple wallet adresses you own , this way it becomes much more difficult to see where the outputs are going to.
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#4209

1.-a UTXO is when you receive a transaction as an input, the sum of all UTXO in your wallet will tell the total balance of it
2.-i fyou don’t have more UTXOs the transaction can’t be done, but if you have more UTXOs your wallet can use them all to cover the transaction and send the remaining balance to your own wallet.
3.-the wallet usually calculates the fee and will choose the one it thinks is best (it calculates it by checking the previous transactions on the blockchain and will choose a fee that will let you get in into the blockchain fast enough). In a completed transaction Fee = Inpunt -Output
4.-the concept of inputs and outputs adds anonymity because you can´t know who controls the BTC addresses (if you have many outputs you can’t tell whichone goes back to the wallet and which ones are the spent transactions).

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#4210
  1. Describe what Unspent Transaction Outputs (UTXO) are.

It is an unspent transaction sent from someone else’s wallet that sits in your one waiting to be sent to be spent

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

It will combine another UTXO into the transaction and send the difference back to yourself (or another wallet you control) minus the transaction fee.

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

You calculate the input minus the output and the transaction fee is the sum that is left

  1. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
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#4211
  1. UTXO is incoming transactions that are are received and not yet spent.
  2. A wallet will combine all UXTO to make a transaction. If all do not cover output, it will be declined.
  3. Input - output = fees
  4. Use different adresses
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#4212

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

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#4213

1 unspent transactions include btc sent to a wallet and received but not sent out for spend yet.
2 if there is not a single utxo that cam cover a transaction then another one (or more) are used
3 the wallet specifies the transaction fee on the spend side
4 since many utxo can be used for one spend it is harder to identify

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#4214
  1. The actual balance you are able to spend.
  2. The transaction would be rejected
  3. By the amount of data required to complete the transaction. The difference between input and output = transaction fee
  4. Uses a different address for each transaction.
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#4215 
1.Describe what Unspent Transaction Outputs (UTXO) are.

UTXO are “money” which came to you

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

you have to use more UTXOs to cover it

  1. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Wallet will show it as a part of output total output=fee+output tx

  2. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    It is hard to deduct who controls BTC as you send sen a part of BTC to your address

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#4216
  1. These are bitcoin transactions to you which are available to arrange further payments to someone else.
  2. You sum up several UTXOs until it’s enough for transaction.
  3. Input - output = transaction fee
  4. By making several outputs
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#4217

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

#4218

  1. UTXOs are unspent transaction outputs, they are unspent outputs of past transactions that your wallet recognises as available funds.

  2. Your wallet would input several different UTXOs into the transaction, the remaining amount will be turned into “change” and sent back to a wallet you control.

  3. By subtracting inputs by outputs

  4. You make use of multiple wallets

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#4219

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    These are transactions that have are in the phase of the process where they have left a wallet and not been re-spent by the new recipient.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    UTXOs can be consolidated so that this covers your transactions.
    Unless it is a case where you do not have enough in you wallet, it which case the transaction will be discarded.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    It will review the blockchain for previous fees and recommend the fee.

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    Break the transaction down into multiple transactions, and use multiple wallets that you have access to.

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#4220

  1. UTXO’s are all the individual bitcoin transactions that are sent to your wallet address that have not been spent or sent to another address.

  2. Your wallet will automatically sum all of the UTXO’s that are associated with your wallet address in order to cover the full transaction balance. It will actually send the full balance of the wallet to cover the transaction and then send the remaining balance back to itself as a new UTXO.

  3. The the transaction fee is calculated by the UTXO input - UTXO output. Wallets will automatically calculate what a good fee would be in order to be picked up sent by miners, but some wallets allow users to specify the fees they are willing to pay.

  4. You can create several bitcoin addresses and increase the number of outputs for your transaction. If you increase the number of UTXO outputs and route some of them to addresses that you control, it would be difficult to determine the total value of your BTC holdings.

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#4221
  1. UTXO are the balance left in your wallet that it keeps track of.
  2. The transaction would be declined if your UTXO is not large enough to cover it.
  3. The wallet checks the blockchain and figures out the correct fee.
  4. Several addresses and outputs can result from one input.
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#4222
  1. All incoming funds remain as an Unspent Transaction Output until a transaction is completed by an outgoing settlement being made. These transactions remain open on the blockchain, your balance consists of an assemblage of these UTXO’s compiled by your wallet through queries to the blockchain.
  2. This compilation of UTXO’s means that if a single transaction is not enough to complete an outgoing settlement then your wallet can integrate further UTXO’s to cover the transaction. If any remaining balance is left, then it can be sent as another output back to the original address.
  3. The wallet will select a fee based on price and access to the blockchain, it will calculate the quickest available route to the chain to complete the transaction in a reasonable time frame whilst also considering cost to achieve the most desirable compromise. This will then be reflected in the difference between input and eventual output.
  4. Creating novel outputs for a transaction can help disguise the end destination. By diverting outgoing funds to a separate address controlled by the original sender it becomes exponentially hard to trace.
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#4223

  1. Unspent Transaction Outputs (UTXOs) are the funds when someone is on the receiving end of a transaction (or output of a transaction) because they haven’t spent those funds yet.

  2. If you don’t have enough UTXOs big enough to cover for a transaction you are trying to construct, you may need to tap into smaller UTXOs in your wallet. If you still do not have enough funds to cover a transaction you are constructing, the transaction will not be valid.

  3. A bitcoin wallet specifies a transaction fee by the sum of the inputs minus the outputs.

  4. You could increase privacy in your transaction by sending remaining funds of a transaction you’ve constructed to another wallet in your possession. That way - the people who look at the transactions in the blockchain will not know or realize that you sent yourself the leftover funds (change).

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#4224
  1. it’s the fund you hold/received and you can spend
  2. then you won’t be able to transact
  3. UTXO input - UTXO output = transaction fee
  4. use different addresses for different transactions
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