Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#5507
  1. UTXO’s are your total transaction broken down into smaller transactions on the blockchain.
  2. The transaction would be declined as it is not valid, or accepted by miners.
  3. Fee = Input - output. The fee is implied and recommended by the wallet based on overall congestion within the network.
  4. Because the transactions are broken down into UTXOS, it can’t be tracked back to one wallet or transaction within the blockchain. It increases privacy in that regard.
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#5508

  1. Unspent Transaction Output (UTXO) are transactions that have been received but not yet spent. Similar to a balance but on the Bitcoin network.

  2. If you don’t have any single UTXO that is large enough to cover for your transaction then the transaction wouldn’t work/go through, but before that your wallet adds all your UTXO’s when the transaction is being processed.

  3. The Bitcoin wallet uses an average transaction speed and cost but some wallets allow for the customization of this whether you want a slower/cheaper or faster/expensive transaction – Also note since Miners are for profit, they will post transactions with higher transactions fees hence them being faster to go through the network.

  4. Since the UTXO’s are just a bunch of numbers/addresses and several addresses and output can result from one input.

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#5509

  1. A UTXO defines an output of a blockchain transaction that has not been spent.

  2. The transaction will fail.

  3. Input minus output.

  4. If I use a private blockchain or use different recipients (more than 1 adress).

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#5510

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.

#5511

1.) UTXOs are the transactions, which came into your wallet, and have not been spent again.
2.) You can make the transaction, if the sum of all previous UTXOs coming into your wallet, is higher than the amount you want to spend.
3.) You can either adjust the fee yourself, but most wallets will adjut the fee to previous transaction fees on the blockchain, such that the transaction will take place within a reasonable time.
4.) You can send some BTC to yourself, so if someone would surveil one address, the blockchain would tell him that you made another transaction from that address. However, the funds can still be followed.

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#5512

1.) UTXO’s hold the balance left over from previous transactions on the blockchain so that your wallet can query them with your private key and give you a sum of how many UTXO’s you still have available for your wallet to use.

2.) The transaction would be declined by the nodes/miners.

3.) The wallet would find the most reasonable transaction time/cost from previous transactions and offer you the chance to choose whether you accept it or not.

4.) By sending the transaction through to a new wallet still owned by you but split between several wallets.

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#5513

1 UTXO shows the previous tx output into your address.
2 Tx will decline or not go through
3 It will check the blockchain for the latest data
4 You can use different address for making transactions

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#5514

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.

#5515
  1. Unspent transactions are transactions that you receive from getting cryptocurrencies, for example, my girlfriend sends me 1 ada and then i get 2 more for another person, i, therefore, have 3 unpent ada.
  2. then it would combine all of your UTXO to cover the entire transaction and send you back the unused portion of the transaction.
  3. the wallet would add the total amount then subtract the fee leaving you what the final amount would be minus the fee.
  4. you could track each transaction to see how much each input and output would be and that would enable you to keep an accurate record of each transaction and be able to moitr your transactions correctly and know the toal amout of each transaction and the toala amount in your wallet.
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#5516

  1. They are the outputs of a previous transaction that “sent BTC” to a wallet but they are not spent yet on the new wallet.

  2. The wallet automaticly will sum all the UTXOs to cover the transaction. All UTXOs has to be spent, the no needed UTXOs will go back to the wallet.

  3. Calculating the averge transaction fee of the block to get out transaction online at a suitable time period.

  4. All the inputs have to be spent so, the output will be at least two transactions one of them may be a different adress of your wallet therefore you can not tell how many UTXOs have you transfered to the target wallet/s and how many went back to our wallet.

#5517

All UTXOs are not necessarily spent, only the UTXOs that are enough to cover your transaction are spent.

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#5518
  1. The total UTXO = the wallet balance.
  2. Transaction would be declined.
  3. Look at blockchain and see how much fee is necessary.
  4. Use multiple adresses and send to new so it is impossible to track which goes back to the owner.
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#5519

1). UTXO’s are the amount of BTC that comes into your wallet from a transaction between you and another person. Think of it as an ACH deposit into you bank account. You need to have money in your bank account in order to spend money!

2). You would not have enough BTC in your account to make the transaction. Similar to “insufficient Funds” in your bank account. So you could not buy whatever it is thta you want to buy…(sigh)

3). The wallet doesn’t specify the fee. It is implied. FEE = UTXO - the cost in BTC.

4). there is no way of telling from who this came from if you use different addresses to receive BTC.

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#5520

Wallet calculates the appropriate fee for your transaction taking into account current network conditions and transaction size. There are some wallets with dynamic fees means you can choose between a Priority fee and a Regular fee.

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#5521

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.

#5522

Thanks for the correction

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#5523

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    UTXOs are inputs you have received that become unspent transaction outputs, or essentially the funds that are allocated to your wallet that you are allowed to spend in new transactions.

  2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
    Your wallet would add additional UTXO’s to cover the remaining.

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    The transaction fee is the difference between inputs and outputs since they both must be the same in any give transaction.

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

    One could control multiple wallets and send funds to others but also to yourself.

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#5524

Thanks for the tip and for the correction!

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#5525

Homework on Bitcoin Transactions and UTXO - Answers

  1. UTXOs are outputs from the previous transaction.

  2. The transaction wouldn’t go through.

  3. The bitcoin wallet takes the Input of a transaction and subtracts the output to get the transaction fee.

  4. Using multiple bitcoin addresses ensures privacy.

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#5526

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.