Homework on Bitcoin Transactions and UTXO - Questions

Blockchain and Bitcoin 101
#6069

1. Describe what Unspent Transaction Outputs (UTXO) are.
A UTXO, in this case is a discrete piece of bitcoin. UTXO’s are used as the input for bitcoin transactions.

2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
You could use a combination of UTXO’s in your wallet to cover the transaction. If the combined value is not enough, the transaction will be rejected.

3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
The wallet usually determines the fee - hopefully a reasonable compromise between cost (for miner) and time to complete transaction.

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
You could use a different address every time you send yourself funds ( it would seem that with a SHA -256 system where the output cannot be reverse engineered to the original info, this would not be too concerning ?)

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#6070
  1. Unspent Transaction Outputs are sent bitcoin that the receiver has not spent/constructed an input with.

2.What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
-> a wallet could locate all your available UTXOs and combine them into the input tx.

  1. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    -> input - output = TX fee

  2. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
    -> Many address outputs from 1 input

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#6071
  1. they are the amount of bitcoin in your wallet that you’ve received but not spent
  2. Then the transaction will not happen
  3. Fee equals the total inputs less total outputs
  4. Each transaction is very hard to identify to a person. It’s identifiable to a computer
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#6072

Answers:

  1. It refers to how your wallet constructs a transaction.

  2. You will not be able to make a new input.

  3. The Fee is what remains from the input minus the output.

  4. Increasing the inputs on each transaction so you also increase the outputs. In this way, it will be harder for someone reading the blockchain to know which amounts are coming back to you.

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#6073

  1. Transaction witch was been recived previously. Wallet does not store bitcoins, it asks network for UTXO’s to know how many BTC you have.

  2. It will take from future transaction balance.

  3. It will check UTXO’s transactions so fee would be similar.

  4. By hashing them.

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#6074
  1. unspent balance in wallet
    2.it doesn’t transact
    3.the difference between the input and output
    4.add more inputs or outputs to increase privacy
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#6075

The most basic approach would be to use a new address every time you receive funds or send change back to yourself. It is impossible to tell who’s sending to whom.

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#6076

You can use multiple UTXOs as inputs to a new tx. If you don’t have enough your transaction would be declined.

2 Likes
#6077

I appreciate the added knowledge :slight_smile:

#6078

  1. Any UTXO is the balance available in a wallet in order to be used.

  2. If you do not have enough BTC in order to pay for the fee, then you should have to buy more BTC.

  3. It depends from wallet to wallet, some of them allows to set the fee in order to the speed needed for the transaction.

  4. By using every wallet as if it were disposable. After sending BTC to someone, I`ll send the rest of my BTC to a new wallet.

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#6079

1 last transaction received by this address and not spent yet

2 transaction will failed

3 output lower than input

4 by sending the remaining UTXO to another of your own address in the wallet

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#6080

It will sum up more UTXOs. If there is no sum of multiple UTXOs that make up larger output, the transaction is invalid.

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#6081

1.) UTXO’s are unspent outputs from tx.
2.) The TX wont be accepted
3.) The transactions decides the amount of fees.
4.) Thanks to encryption noboday can find out your PK

#6082

  1. UTXOs are unspent transactions that sit in your wallet, but must be spent (even if some of it gets spent back to you.) Each input produces an output that is a UTXO until spent.

  2. If you do not have a UTXO large enough for your transaction you cannot use it… you must have the full amount or more in order to make a transaction.

  3. A transaction fee = input - output. The wallet calculates this for us, but the miners get to choose the fee so they get paid. Fees are generally very low.

  4. Transactions are private because it uses your public key, which is derived from your private key in your wallet. You can do smaller amounts or multiple transactions to break it up into different blocks to make it more private?

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#6083

  1. UTXOs(Unspent Transaction outputs) are transactions that have been previously sent to you by another client.

  2. If you don’t have enough UTXOs to cover for your transaction then your transaction will be denied.

  3. A bitcoin wallet specifies the transaction fee as the substracted amount between the sum of the inputs and outputs.

4.You can create multiple receiver addreses to deceive the spectator of the real transaction details.

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#6084

1. Describe what Unspent Transaction Outputs (UTXO) are.
Answer: When a certain transaction happens, there is an input and an output along with a minimal transaction fees. The output here is called an UTXO. These are bitcoin held/stored by a person, and their sum is the balance of the person’s Bitcoin calculated by his/her wallet.

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

3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
Answer: Usually transaction fees is input - output. But this said fees is the closest to the previous transaction fees on the blockchain and your wallet selects this fees for the fastest possible transaction.

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
Answer: Use multiple inputs and outputs with one or more of the output addresses being the actual transaction and the rest being returned to addresses the sender controls to enhance the security and keep the transactions a whole.

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#6085

  1. UTXO are all outputs to receive by an address (private Key) that were still not used in transactions. The sum of UTXOs are calculated by wallets and represents the total balance of a wallet.

  2. If you don’t have enough UTXO (balance) your transaction will be invalidated by nodes.

  3. The fee will be calculated by the difference between inputs and outputs in a transactions
    Fee = Inputs - Outputs

4.You should receive funds in different adress.

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#6086

It will sum up more UTXOs. If there is no sum of multiple UTXOs that make up larger output, the transaction is invalid.

1 Like
#6087

  1. Describe what Unspent Transaction Outputs (UTXO) are.
    the balance in your wallet from unspent amounts left on chain

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

  3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
    the wallet checks the blockchain to calculate the correct fee (generally from the past history of fees on this chain or the supply and demand of current transactions)

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

Use several transaction inputs to create one output

#6088

It will sum up more UTXOs. If there is no sum of multiple UTXOs that make up larger output, the transaction is invalid.

1 Like