Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#4987

The wallet/exchange did that for you so the transaction you made won’t take time to get picked by miners, as the miners are financial invectives they pick transactions with highest fee, but if you choose to not you wallet/exchange the whole process what the wallet/exchange is offering you have to do it your self like creating the transaction and deciding on the fee.

#4988

You can use multiple UTXOs as inputs to a new tx. If that isn’t enough to cover your transaction then your transaction would be refused.

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#4989

Homework on Bitcoin Transactions and UTXO - Answers

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXOs are outputs from a transaction that have yet to be used as inputs. They can be seen as analogous to paper money that has been taken from a wallet but is not yet in the cash register.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    If there is no UTXO large enough to fulfill a transaction, the transaction would fail, as it would have no input to result in the desired output. Multiple UTXOs could be used together so long as the output value of the transaction is equal to the combined UTXO value, minus the fee.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Transaction fee values are found by subtracting the output value from the input value.

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    Multiple addresses owned by the same person (within the same wallet or otherwise) could be used to add more layers of anonymity and make the identities of the recipients more difficult to deduce.

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#4990
  1. UTXOs are basically the change left over from BTC transactions.
  2. Your wallet would use multiple UTXOs as inputs to cover if the tx is larger than any one available UTXO.
  3. The wallet calculates the fee by subtracting the sum of the total outputs from the sum of the total inputs.
  4. You could be paying UTXO to another wallet address that you own so no one would know much you hold.
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#4991
  1. Describe what UTXOs are.

UTXOs refers to transaction output that can be used as input in another transaction.

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

If any single UTXO as well as the sum of all UTXOs doesn’t cover the transaction, the transaction is not processed. If, however, the sum of two or more UTXOs is sufficient to cover the transaction, the transaction is processed.

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

The transaction fee is the difference between the transaction input and the transaction output. It is automatically computed based on the network protocol and sent to the miner.

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

The input of a single transaction can come from multiple addresses and the output can also be sent to multiple addresses. You could send UTXOs to multiple addresses that belong to yourself, thus making it appear that your UTXOs have been sent to different recipients while you are actually the only recipient.

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#4992
  1. A UTXO is an unspent sum received by a recipient. (balance)
  2. The transaction would be declined
  3. Fees are determined by both the network conditions at the time of transaction and the size of the data being sent. The busier the network is and the larger the amount of data being transferred, the higher the fees.
  4. Increased privacy can be achieved by increasing the number of outputs.
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#4993

  1. It is a whole or partial of a Transaction output. You could describe it like kind of a cheque like we do in fiat currency. The wallet asks the blockchain for the wright UTXO´S. They are stored on the blockchain. An UTXO is the amount remaining after a executed transaction.

  2. There will be no Transaction it will be rejected. Your wallet asks the Blockchain but there will be not the wright UTXO available to complete the transaction.

  3. The input will be the output plus TX fee. So the input is (for example BTC) 0,5 output will be 0,4 and 0,1 fee.

  4. You could construct your transaction so that you are the recipient of some of the outputs. So you fracture the outputs. Or use multiple adresses. Then it will be very difficult or almost impossible to track and so it will increase your privacy.

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#4994

  1. An UTXO are transactions that includes your balanced BTC associated with different addresses, the input has to be equal to the outputs. So if you have 0.7 BTC but wanna send 0.5 BTC, the output will be 0.5 + 0.2, 0.2 goes back to you.

  2. The wallet will combine all available UTXOs to cover the amount in the transaction. If not, the transaction will be denied.

  3. The bitcoin wallet fee is the total inputs subtracted by the total outputs, if you have a higher transaction fee your transaction will be put on the Blockchain faster than a lower transaction fee because the miners gets more profit from it.

  4. You could send the transaction to multiple addresses including your own by increasing the amount of inputs and outputs. As the public key are hashed you could send to the same receiver multiple times and the transactions will be difficult to trace.

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#4995

You can use multiple UTXOs as inputs to a new tx. If that isn’t enough to cover your transaction then your transaction would be refused.

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#4996

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXO’s are transactions that you had received from other people (or yourself depending on the situation) that can be used as inputs to set up outputs to different addresses.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    What would happen is that your wallet would combine UTXO’s that surpass this value you want to send, send them both, then send your change back to your address that you control (ofcourse after the transaction fees)

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Inputs-outputs= transaction fee

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    From the input sent, fractional amounts of the inputs can be sent to addresses control by the same party.

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#4997
  1. UTXOs are unspent outputs of previous transactions.
  2. The transaction would not be valid
  3. The fee is calculated as a remainder of all inputs minus the outputs of transactions.
  4. Use a multiple addresses for each receiving transaction and partial payments being sent back to one’s own wallet…
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#4998
  1. UTXOs are the amount of bitcoin you can spent
  2. The sum is taken of the total UTXOs, the required amount will be sent to the recipient, and anything left over will be sent back to you.
  3. The wallet will check the blockchain for what the previous fees were and give a suggested fee based on what it located in the blockchain
  4. You can increase privacy by using up all the UTXOs by sending it to any output but yourself, meaning you don’t leave any left over to come back to your address. Another way is by sending the left over to another bitcoin wallet due to it having a different address.
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#4999
  1. UTXOs are the amount of cryptocurrency left after an output from a wallet. It’s like change that remains when you have purchased something. You can use that UTXO on another transaction until it is all gone (after fees).
  2. The transaction would be comprised of a number of smaller UTXOs that the wallet keeps track of. However, if they still don’t add up to the total amount needed the transaction would be unsuccessful and would be declined. It doesn’t matter if it is a single UTXO or multiple UTXOs as long as there is enough in total (I think?).
  3. Most wallets will select the most appropriate fee to ensure the transaction is successful. The fee is somewhat based on the “going rate” of the previous transactions. I think there are wallets that allow you to select the fee based on the urgency of the transaction but not sure about that.
  4. The identity of the addresses is anonymous and you could also split up a transaction into several transactions. There would then be several addresses and there would be nothing that would identify them to any particular individual. But I think that if you search for that address you can find other transactions to that address.
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#5000

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

#5001
  1. UTXO are the transaction that send from the wallet.
  2. It will fail.
  3. The wallet will specify the fee from the amount of your spend and from previous fee from the blockchain.
  4. You can send transaction to yourself with different address.
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#5002

`1) Unspent transactions received remain UTXO until new transaction is created.
2) Transaction would be declined.
3) Input minus Output
4) Use multiple outputs.

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#5003

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    Unspent transaction outputs are are new inputs to your wallet. In other words they are the funds that you have received and have not spent.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    If you do not have a UTXO that can cover a new transaction, the UTXOs will remain UTXO until the criteria for the transaction can be met by adding up all the available UTXOs or a new smaller transaction amount that can be covered by the UTXOs is selected.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    It queries the blockchain for the last transaction fee used and selects a transaction fee amount that will help your transaction go through reasonably fast.

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    The notion of inputs and outputs help make the end point of the funds vague since it will not be clear if they are ending up in a new wallet that you control or if they were sent to somebody else since the address can be different every time.

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#5004

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    They are any outputs that have been previously sent to your wallet address, such that your private key has the ability to sign a new transaction to send those outputs to a different address. Summed together, they make up your spendable balance in your wallet.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction? Other UTXO(s) under your wallet’s control would need to be added to the new transaction and any “change” would then be sent back to your wallet.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    Inputs - outputs = fees

  4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    Adding additional outputs to different addresses owned by the same wallet.

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#5005

You can use multiple UTXOs as inputs to a new tx. If that isn’t enough to cover your transaction then your transaction would be refused.

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#5006

  1. UTXO are Unspent Transactions outputs in your wallet. Tells you what balance of bitcoins you have to spend.

  2. The transaction will not go through and will be kicked out of the block.

  3. The fee is calculated but subtracting the input from the output on the chain.

  4. Creating new address after each transaction can help with privacy. Since they are random number it helps to hide the identity.

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