Homework on Bitcoin Transactions and UTXO - Questions

[Jippo13]

Homework on Bitcoin Transactions and UTXO - Questions

1. Describe what Unspent Transaction Outputs (UTXO) are.
   In essence, a UTXO can be spent as an input in a subsequent transaction. Your always need a UTXO or an unspent transaction output to make a transaction. If you don’t have an unspent transaction output (OTXO) , it simply means you don’t have any Bitcoin.

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 large enough to satisfy the demand of the input amount, then the WALLET will use a second, a third, etc until the total is greater than or equal to the amount you’re sending. This is because the Bitcoin protocol requires that any UTXO must be completely spent if it’s used to fulfil the total input requirement. You simply cannot divide UTXOs. The difference is sent back to you as “change” during the transaction, put simply the “change” is represented as a newly created UTXO assigned to you.

3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
   Lets say A = Inputs and B = Output and A = 3 BTC and B = 2.5 BTC. (Eg A = 3 and B = 2.5).
   We know that A has to be greater than or equal to B to have a valid transaction. Now, If A is greater then B (as describe above), then the transaction fee would equal A - B = TX fee. (or 3 - 2.5 = 0.5)

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
   On one or more output you could specify a condition that only the person who has the private key that match the public key can receive the transaction. An output could be sent to the sender input which would have a different address and no one knows the private key except the private key owner.

[figurin]

1. scribe what Unspent Transaction Outputs (UTXO) are.
   total of UTXO is the wallet balance.

2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction? no transaction will be possible

3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
   UTXO minus UTXO input = fee

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
   use a private blockchain as well as Several addresses and outputs can result from one input.

[JustinP]

1. A UTXO is a record of a transaction with an input being the sender and the output being the receiver. The receiver then has the ability to spend the funds in that UTXO. The wallet adds up these UTXOs to show your balance.

2. When you spend, the wallet will collect enough UTXOs to cover the transaction and send the remaining balance back to your original address.

3. The wallet will look at recent transactions and propose a fee which is fair to get your transaction processed in a reasonable amount of time.

4. Transaction inputs and outputs increase privacy because addresses are not linked to an individual and new addresses are generated during transactions.

[Christophe_H]

1/ UTXO are the available bitcoins that a wallet can transfer
2/ The wallet would combine UTXO to perform the transfer
3/ The wallet would look at the blockchain to have an idea of the fee
4/ Wallet have to spend all UTXO during a transfer. Some of the BTC gets sent to a new wallet/address that you have control over

[tarekhlb]

Describe what Unspent Transaction Outputs (UTXO) are.

UTXOs are your unspent inputs. Here your Inputs are old outputs by previous transactions. It is basically the balance of BTC you can spend.

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

As long as the sum of your UTXOs can cover the transaction including fees, you will use as many UTXOs needed as inputs in the transaction and generate the needed output.

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

The transaction fee is the difference between the input and the output.

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

No one can know if the outputs are to you or to someone else.

[MartinK]

1. UTXO s are inputs which are not spend yet .all UTXO.s together is the number you can spemd and is calculated by the wallet.

2. the transaction is not possible. the walltet will not get the varification from the blockchain.

3. the fee is always input minus output.

4. you can increse it if there are more output adresses involved and always different ones.
   also it is very difficult to identfy the real receiver adress ans which transaction goes back to the sender.

[Ondrej.S]

1. Unspent funds which can create a new input for future transactions.
2. Transaction wouldn’t be mined and added to the blockchain.
3. It can either create it automatically looking at the blockchain and previous fees or you can set it manually in certain wallets. However, the input cannot be lower than the output and transaction fees altogether.
4. The output comprises of several addresses of one input so it the recipients identity is unclear.

[plaxel]

Homework on Bitcoin Transactions and UTXO - Questions

Describe what Unspent Transaction Outputs (UTXO) are.
UTXO’s are all old inputs recieved from other people. When you recieve a transaction it is an unspent transaction.

What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
You will equal the input to the output, so if you have 0,5 and 0,5 = 1.0. you want to send 0,6, you will need to send 1.0.
0.6 will go to your one output, the one you wanted to sent to and approx (-fees) will be send back to you.

How would a bitcoin wallet specify the transaction fee when creating a transaction?
It would look at how much the last fee was in the network and calculate a god enough price for your transaction in order for it to be fast enough.

How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
You can use different and many outputs in sending a transaction.

[pascaldeb]

1 the output of a transaction is utxo for the receiver of the transaction

2 the transaction will not pass, it will not be validated in the network

3 imputs - outputs

4 the owner of an adress is unknown, the use of different adresses makes it even more difficult

[Clinton]

1. UTXOs are outputs from previous transactions.
2. Multiple UTXOs would need to be used as the transaction inputs.
3. Based on current blockchain activity, a fee would be created balancing speed of processing with cost savings or another set of considerations.
4. Rules could be created to utilize a single transaction to send coins to multiple addresses.

[DaveAC3]

Correct, and isn’t a “batch of bitcoins” technically the sum of all inputs since there are no actual coins, just a ledger?

I think what I may have had backwards is the “sent to a private key” - correct me if I’m wrong, but my answer should have been “sum of all inputs to a bitcoin address associated with a public key (which your private key can unlock to send again)”?

[zanjakobjez]

1. UTXOs are the balance in your wallet. They are all your transaction inputs combined.
2. If you don’t have enough UTXOs, you will not be able to send the transaction.
3. A bitcoin transaction fee is: Inputs-Outputs=Fee
4. I could increase my privacy by sending my UTXOs to my other wallet/wallets.

[ClapTrap]

1. UTXOs are previously received BTCs which have not been send yet. They represent a sort of “Balance” of your wallet and are the maximum amount you can spend in a transaction (minus fees).

2. Your transaction would be rejected or multiple previously received UTXOs would be used as input for your transaction.

3.A BTC wallet could propose a sort of “fair” transaction fee based on the fees paid on the latest blocks.

4.Privacy is greatly increased using all your UTXOs in a single transaction: Every time you buy something which is less than your whole “balance”, multiple outputs are created, some are associated to the actual sellers and represents the real transactions while at least one represents a different address of your wallet, but there is no way to tell for sure which one of the output is the seller one.

[Mr.D]

1. Inputs that not yet have been converted into an transaction, that is your account balance

2. it would the use several UTXOs and if there’s not enough the transaction would be declined

3. So that it would get picked up by miners

4. Many outputs were several, or none, could be yourself

[DeCryptolorian]

1. Describe what Unspent Transaction Outputs (UTXO) are.
They are the total of transaction inputs sent to you which equals the balance of your wallet. The are responsible for beginning and ending every transaction.

2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
Let’s say you were purchasing a good for 1 bitcoin. A single UTXO had .7 bitcoins and was not enough to cover it. If you had other UTXOs, it would look to them to cover the additional .3 and fees. If no other UTXOs were available, the transaction cannot be made.

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

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
Using different addresses to send amounts. Sending the to other addresses/wallets.

[aryakrishna]

1. UTXO are data around the unspent amount of bitcoin from previous transaction in someones wallet
2. The wallet will sums the amount of other single UTXO to cover the transaction get closed to the needed amount and so the exchanges wont be too far to redirect to the owners wallet, it will be declined by the nodes if the sums cant cover the amount of transaction needed
3. A Bitcoin wallet will drive to the most reasonable fee prices acknowledging from the previous block and the speed needed
4. can just create many address for new inputs

[RailGame]

• Describe what Unspent Transaction Outputs (UTXO) are.
  -Basically they are messages which correspond to the balance of funds in the wallet to which the UTXO was addressed to.

• What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
  -It would have to find the balance via other UTXOs sent to your wallet.

• How would a bitcoin wallet specify the transaction fee when creating a transaction?
  -It calculates it automatically based on the amount of time it takes to verify the transaction. The fee is the difference between the Input and Output.

• How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
  No one knows who owns the addresses. Also the full balance will be spent. If there are 2 outputs, 1 may belong to the sender.

[Nityam_Jigyasu]

• Describe what Unspent Transaction Outputs (UTXO) are.
  UTxO are shows us an unspent or balance left in our wallet that it keeps track of.

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

• How would a bitcoin wallet specify the transaction fee when creating a transaction?
  It requires a blockchain provided by the miner.
  Inputs = Outputs + Tx fees
  Tx fees = Inputs - Output

• How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
  Use several different addresses and send unspent Tx to your other wallet(own).

[247earnings]

1. UTXO’s are transactins sent to another person but have not been spent by the recipient. The ownership of the transaction has been transferred to the new owner but they have not directed where the value is to go.
2. UTXO’s are combined by your wallet to cover the size of the transaction. If you do not have sufficient UTXO’s to cover the transaction it will not be processed.
3. The fee is generated automatically as part of every transaction. It is based on the speed in which the transaction is processed. Some wallets allow you to pay a higher fee for a faster transaction.
4. By having more than one output it is not possible to accurately determine which input was used to create the outputs.

[CryptoRealNews]

1. UTXO are individual transactions (funds/value) you have received that add to your overall balance of funds you have access to or can spend.

2. Your wallet will look to add another UTXO (or any number of) that are yours, until it has exactly or more than the amount needed to cover that transaction. If it is more than you get sent back the “change” to your address in effect.

3. BTC Wallet specifies the transaction fee as Input = Output + TX Fee

4. You can send multiple transactions to multiple addresses. There is no way to truly know from the outside if in fact one or all of those output addresses are not in fact another of your own wallet addresses.