Homework on Bitcoin Transactions and UTXO - Questions

[RustyGray]

1. Your balance.

2. It will use more than one UTXO.

3. fee = input - output

4. Use more addresses.

[Mucha_Julius]

1. They are generated by inputs to your wallet.

2. Transaction would fail.

3. Tx fee=utxo output - utxo input.

4. Distribute outputs to multiple addresses you may or may not control.

[jxdrew]

Q1: UTXO’s are available inputs into the wallet that are able to spend.

Q2: If you don’t have single UTXO that is large enough to cover your transaction you wallet sums up all the UTXO’s assigned to the wallet. If balance is not large enough you wallet will not create the transaction.

Q3: Some wallet offers you the chance to choose your transaction fee (High, Medium or Low) priority speed of getting your transaction on to the blockchain this is based on a reasonable fee, based on previous transaction. Other wallets just state the fee again based on previous transactions.

Q4: You could increase the privacy by increasing the number of outputs in your transaction by sending bitcoins to multiple address back to yourself

[Anarchocapitalxx]

I realize that i did not understand the full concept of UTXO when i did Ethereum 101.
So when we say unspent transactions are actually all
Expl
I buy 1 btc on bit bargain
transfer 0.4 to Binance
transfer 0.5 to my trezor wallet
transfer 0.1 to Coinbase
All this Bitcoin will be UTXO?

[AndreaLuigi]

1. The job UTXO are doing is to keep track how much is left in your wallet
2. If there is not enough in your wallet the transaction will be declined
3. The wallet constantly checks with the blockchain and calculates the appropriate fee
4. Different addresses and outputs will result from one input

[GBIT430]

1: UTXO are unspent outputs from a previous transaction in your wallet.
2: Use another UTXO
3: Input - Output. They dynamically see what fee is required to be accepted by a block.
4: Use multiple inputs and outputs.

[lovreez]

1. Utxo are the inputs you received (unspent) and are now avialable for you to spend. Basically your balance.
2. The transaction wouldnt go throught, it would be declined.
3. The wallet searches the blockchain for the fee that will get your transaction verified in a reasonable time. Also, fee=input-output
4. Increase number of adresses

[Brijay]

1. UTXO’s are one side of any potential bitcoin transaction. They are a record of the bitcoin which has been received by a wallet, but not yet been spent. When they are spent they become the sender’s input and the receiver’s (unspent) output.

2. If you do not have a single UTXO which is large enough to cover your transaction the wallet will add other UTXO’s to make a large enough amount to enable the transaction. It will then return any surplus as change.

3. A BTC wallet specifies the transaction fee by combining the size of the transaction (in bytes) with the current fee rate (satoshis per byte). This amount is then subtracted from the transaction. However, this fee can be manually adjusted, depending on the urgency.

4. You could use the notion of transaction inputs and outputs to increase your privacy in your transactions by using a different address for each transaction and by sending UTXO’s to yourself under different addresses.

[cryp2]

@ivan

Homework on Bitcoin Transactions and UTXO - Questions

1. Describe what Unspent Transaction Outputs (UTXO) are.
2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?

1. UTXO is like “coin” in the blockchain, it’s a transaction that unspent created by wallet to keep track of your balance

2. You cannot do any transaction

3. the bitcoin wallet will look on the blockchain and take a similar fee that will get you on the blockchain

4. The transaction generated is hard to understand by human, only the person who transact will know the exact transaction.

[Watchuku]

1. Wallet balance.

2. The transaction would get declined.

3. Input minus output.

4.Using different addresses.

[Andreas_C]

1. Describe what Unspent Transaction Outputs (UTXO) are.
   -> UTXO are the recorded inputs of the last transaction which are not spend yet. They can be spend on a mininum of 1 output address.

2. What would happen if you don’t have any single UTXO that is large enough to cover for your transaction?
   -> The wallet will add up enough inputs to cover the amount that you would spend. The leftover will be returned to the given back as “change”. If there are not enough inputs UTXO’s available to cover the amount, the transaction will be declined by the nodes.

3. How would a bitcoin wallet specify the transaction fee when creating a transaction?
   -> It will check earlier transactions for the amount that is suitable at the time of transaction in terms of processing time (or you can choose the amount you are willing to pay) and then deducts this amount from the remaining money that will be transferred back to yourself.

4. How could you use the notion of transaction inputs and outputs to increase privacy in your transaction?
   -> I could send the transactions to other wallets addresses that are in my possession.

[Travis]

1. Unspent Transaction Outputs (UTXO) are basically just previously sent transactions but instead of the transaction being complete and added into an account like a bank it will stay there as a transaction until you decided to use it as input for a new transaction.

2. If you do not have a UTXO that is big enough for your transaction you can combine multiple of them for the transaction and then send the remainder of it back to yourself.

3. The fee is calculated from the remainder of the output - the input

4. To increase the privacy of your tranactions you could use multiple addresses in you transactions.

[Fabrice]

@chrisDs

All UTXOs associated with your wallet become inputs for the transaction. If the sum of all UTXOs is still less than the amount you intend to spend, then the transaction gets rejected. If the sum of all inputs is greater than the amount you intend to spend, then the difference becomes the new UTXO which goes back to you plus a small transaction fee.

Not all utxo’s will be used but only a couple of them, until you have enough to cover the output.

[Fabrice]

@chrisDs

1. It is impossible to know who the UTXO belongs to unless you have the private key. Therefore we cannot trace where the outputs and inputs originate.

PS: can someone please check my answer to the 4th question. I see many explanations but I’m not sure if my answer it entirely correct.

Right, a HD Wallet will always use different receive addresses. Only if you have the private keys you can know wich addresses belong to you. So if you use more addresses in the output, others can’t know if you are paying yourself or somebody else.
If you spend the whole utxo to 1 output. There is a high probability that you moved it to 1 of your own addresses.

[Fabrice]

@Davide_Coltro

The transaction is not valid.

You can combine multiple smaller utxo’s together to cover the amount if you don’t have any single UTXO that is large enough.

[Fabrice]

@lordo_keporkak

1/ it is my unspent balance
2/no transaction
3/ the Difference between Inputs and outputs
4/ Its a nature of BTC. No one know only private key owner

You can combine multiple smaller utxo’s together to cover the amount if you don’t have any single UTXO that is large enough.

[Fabrice]

@Vereske

2.The transaction will be refused and doesn t take place

You can combine multiple smaller utxo’s together to cover the amount if you don’t have any single UTXO that is large enough.

[Fabrice]

@ybernaerts

No transaction possible, it will not be accepted by the network.

You can combine multiple smaller utxo’s together to cover the amount if you don’t have any single UTXO that is large enough.

[Fabrice]

@kongpoul

2:
Then the TX will not be approved

You can combine multiple smaller utxo’s together to cover the amount if you don’t have any single UTXO that is large enough.

[Fabrice]

@bsmccall

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

You can combine multiple smaller utxo’s together to cover the amount if you don’t have any single UTXO that is large enough.