Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#4485

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    Keeping in mind, that wallets only store the private key, sign transactions, broadcast those transactions and read the blockchain to give you a balance of your unspent coins.
    UTXOs are unspent transaction outputs, which is basically the balance of your wallet. All inputs into your wallet are unspent transactions outputs of previous transactions. All outputs are UTXOs of the destination address.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    The rule is, that the sum of the input, so all the UTXOs need to be spend entirely. In order to achieve that there might be an transaction that is directed back to my own wallet. The equation is Input = Output - Fees. Since all the input is spend, it does not matter, if any single UTXO is large enough to cover for the transaction.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Fees = Input - Output

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    I don’t get the question. However, privacy is being provided by the nature of the system. The wallet only contains a private key. There is no information about to whom this wallet belongs. Just from looking at the inputs and outputs, it is not possible to figure out to whom the wallet belongs.

Is it, that always the sum of all the input is spend entirely, or only if one single UTXO is not big enough to cover for the output?

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#4486

  1. UTXO are unspent outputs of previous transactions or in other words wallet available balance.

  2. Transactions will be voided.

  3. Calculated using INPUT - OUTPUT = FEE

  4. Generate new address

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#4487

  1. UTXO are input transactions that have not been spent yet.

  2. You can add all UTXO until sums up to the correct amount for the transaction to be initiated if you do not have enough input balance your transaction wont be valid.

  3. Most wallets will calculate the fee according with previews blockchain transaction fees.

  4. You can increase the number of output addresses making really hard to figure it out.

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#4488

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    When bitcoin is sent from someone or from myself to my wallet, it is added to my UTXO (Unspent transaction output), which I can then send to someone or to myself. Blockchain can verify which UTXO can be spent with my private key.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    Wallet creates a new transaction by adding up all UTXOs as input and also as output, then whatever changes after covering the transaction including the transaction fee are sent back to myself. As a result of the transaction, the input must equal to the output.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Wallet calculates the transaction fee that it finds to be the most reasonable by querying blockchain. The transaction fee will be the difference between the input and the output.

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    All transactions are fully viewable in the blockchain, but the identities and personal information of the senders and the recipients stay anonymous.

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#4489

I might be but I don’t know what method they use. I’m not using that explorer and I haven’t noticed this in the other explorers.

#4490

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

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#4491

  1. They are the transactions that your wallet receives and with them your balance is calculated.

  2. Two or more UTXO will be used in order to send the amount you need.

3.The difference between inputs and outputs

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#4492
  • UTXOs are the legitimate amount of BTC who can spend based on the previous transactions.
  • It will not be validated by the netowrk.
  • Wallet can recommend a reasonable fee to the user.
  • Privacy can be increased by the transactions which are sent to the anonymous public keys.
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#4493

Your wallet will calculate the sum of your total unspent transactions to equal the amount needed, if not enough the transaction is not allowed to take place.

#4494

Question Number 4???

#4495
  1. Unspent Transaction Outputs (UTXO) are the remainders from previous transactions that can transmit further (be forwarded to yourself) for future transactions.
  2. If for some reason you didn’t have any single UTXO that is large enough to cover for your transaction, your wallet could add up previous inputs to create a new transaction. If the amount was still deficient the transaction would be denied. In other words, the system would use more than one UTXO if available. If not, it would decline the transaction.
  3. Although a fee does not ever need to be specified in a personal wallet, a bitcoin wallet can specify the transaction fee when creating the record of a transaction by assessing the difference between the inputs and outputs of said transaction. In other words, it is implied from the transaction itself. In terms of the fee itself, the user is given the choice of fees based on network conditions and transaction size and can/might choose depending on desired speed of uptake.
  4. One could use the notion of transaction inputs and outputs to increase privacy in the transaction by increasing the number of inputs/outputs from different addresses (more transaction additions and sends that would break apart the remainders into further subsets) that would add greater anonymity. Since the only thing reported is the address, multiple addresses representing both inputs/outputs would lead to greater anonymity/security. In other words, getting lost in the crowd. However, it would presumably be possible for bots to track the transactions over time and build a pattern recognition for the transactions, and therefore be capable of tracing to certain addresses over time if ever addresses were repeated.
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#4496

Thanks for your fixing to my answer. The wallet will stop it because anyway if you submit the transaction it will be stopped right?

#4497

Homework on Bitcoin Transactions and UTXO - Questions

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

These are the transaction on BTc sent to you that you have not utilised or spent.

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

Your wallet will use another one to make up the rest.

  1. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    It does not, its implied. a there is a difference between the total output and the input which is equal to the transaction fee.

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

you can add another address of your won to the transaction making it hard for the viewer to know which of the transaction went to you and which went to the intended recipient as both are anonymous.

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#4498
  1. UTXO are transactions that a wallet has recieved but not spent yet.
  2. The wallet will look for other UTXO’s in wallet to combine to create the transaction. If not enough UTXO’s are available to total the sum of the transaction then the transaction will fail.
  3. The fee is the difference of the inputs mins the outputs. This is determined based on current transaction fees but can be adjusted by request when the transaction is created.
  4. This would require creating multiple addresses for recieving transactions
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#4499
  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXOs are transactions which has been sent to your wallet, but have not spent yet.
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    If a single UTXO isn’t enough to cover your transaction it will add up other UTXOs in order to fill the transaction. If that still isn’t enough the transaction will be denied.
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Your wallet won’t specify the transaction fee. However, you can calculate it yourself by calculating the difference between the input and the output.
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    By adding more addresses to your transaction it will be much more difficult for the outside to see which amount went to which address. That way you can increase your privacy so it will be harder for others to find out how much you sent to an address of your own and which amount you actually spent.
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#4500
  1. UTXOS are the unspent outputs from the previous transaction.
    2 There would be no transaction at all.
  2. they would specify a fee by subtracting Input-output= transaction fee
    4 the use off difference addresses would make it hard to understand and increase privacy.
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#4501

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    These are inputs into your wallet , transactions that are unspent, that you can then use to make transactions with. In other words, they are unspent outputs from previous inputs…

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    Your wallet will add up all of your UTXOs in order to make the required output, if still not enough then the tx will fail.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    A BTC wallet will not specify the transaction fee but it will automatically work out the transaction for you so that the input = output + tx fee.

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    By creating more addresses for the outputs it becomes difficult to see what is happening thus creating more privacy.

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#4502

  1. UTXOs are possible inputs that you can use in creating your own transactions.

  2. Your transaction will not go through.

  3. The wallet calculates the fee by taking the inputs and subtracting the outputs.

  4. By creating a transaction with an output that sends yourself coins it increases privacy for that transaction as you will not know with certainty where the coins are being sent to.

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#4503
  1. Describe what Unspent Transaction Outputs (UTXO) are.
    -UTXOs are previously received transactions into an address
  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    -No tx will occur until the sum of UTXOs is greater than or equal to the tx output + tx fees.
  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    -the UX depends on the specific wallet used to send the tx but a higher than average tx fee will prioritize a tx over a tx with a below average tx fee. tx fee = input - output
  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    -you can send part of the tx to another address that you also control
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#4504
  1. Outputs from a transaction that have yet to be spent.
  2. It will look for other UTXO’s and combine them to facilitate the transaction or it will not be processed and tossed out.
  3. The difference between the inputs and outputs
  4. Using a different address when receiving
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