Homework on Role of Wallets - Questions

Blockchain and Bitcoin 101
#2870

Homework on Role of Wallets - Questions

1. Describe in short what a bitcoin wallet does.
A bitcoin wallet is a store for your private keys.
As your private keys allows you to interact with the blockchain, creating transactions or querying for your balance (as the coins live into the blockchain rather than into the wallet), you will need to use your wallet, in a certain way, to connect with the blockchain.
There are 4 main types of wallet (without considering hosted wallets, where you don’t actually own any private key)

  • Nodes: Stores the private keys and a copy of the blockchain
  • SPV’s: It is an application where you can have your private keys. They will need to connect to a node to broadcast transactions or query for your balance
  • Paper Wallet: You can write your private keys on a paper, so you can use it to verify your identity when creating a transaction or querying your balance in any device
  • Hardware Wallets: They are specialized hardware to store your private keys, where you can store and sign transactions without sharing your private keys with any device. This adds a new layer of security, as your private keys never leave the wallet, so they are not accessible to other devices or internet.
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#2871

Wallets are applications on a phone or computer. The wallet only stores private keys, not monetary value. Key storage can also be accommodated via full node, SPV, paper wallet or hardware wallet. The wallet can send and receive Bitcoin. The wallet initiates a transaction, assigned with the private key, in order to sign the transaction with a digital signature.

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#2872

Technically the wallet part only stores keys and signs transactions. Full nodes and SPVs usually also contain a wallet but are technically two independent features. :slight_smile:

#2873

Thanks for the correction!!! So, the wallet feature stores keys and signs transactions. I understood that it only stored the key, as in the paper wallet example.

#2874

A BTC wallet stores your private keys, and is able to broadcast transactions to peers with your signature. It reads from the blockchain, and allows you to view your funds which exist on Bitcoins blockchain.

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#2875

The bitcoin wallet stores your private key and create public keys. The bitcoin wallet does not store any coins, the coins are in the blockchain. You just use your bitcoin wallet to tell the blockchain what you want to do with your coins.

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#2876

In case its a paper wallet in merely stores the key, can’t really sign tx :stuck_out_tongue:

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#2877
  1. A bitcoin wallet stores your private key that links to your funds and allows you to create or sign a transaction. Once the transaction is created it gets broadcasted to a node for verification and transfer of funds. There are many different types of wallets with different levels of security, some being on the physical USB and others on platforms being stored on the internet for regular exchange.
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#2878

Holds your private keys, initiates and signs transactions.

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#2879

1.Bitcoin wallet holds your private key and is used to sigh transactions and sent them to the network to validate.

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#2880
  1. A bitcoin wallet stores your personal private key. You wallet uses your private key to sign transactions.
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#2881

Describe in short what a bitcoin wallet does.
- Holds your private keys
- signs transactions
- send/broadcast transactions
- show the balance
** No coins are stored on the wallet

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#2882
  1. A bitcoin wallet signs transaction and propagates it to the nodes.
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#2883

Homework on Role of Wallets - Questions

  1. Describe in short what a bitcoin wallet does.

A wallet holds your private key and uses it to sign transactions allowing you to:
Send (broadcast transaction to the network for verification by nodes which is then mined).
Receive (reads the blockchain to notify you of incoming transactions).

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#2884

a Bitcoin wallet stores your private keys and utilizes the private keys to sign transactions and continuously check your balances

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#2885

Bitcoin wallet stores Privet keys. To send BTC, it creates and signs the transaction that is being made, notifies and broadcast the information about transaction that has been made, also receives the same way reading the new blockchain information of incoming transactions that is made. No coins in existence.

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#2886
  1. Bitcoin wallet stores your private key, sign transactions, broadcast transactions to network, and reads blockchain in order to notify user on current funds.
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#2887
  1. Describe in short what a bitcoin wallet does.

A bitcoin wallet stores private keys which are used to create a digital signature.

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#2888

A Bitcoin wallet does:
-Stores your Private Key
-Creates a signature and handles the broadcast.
-Read the blockchain to inform you if you have received any funds

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#2889

A Bitcoin wallet is a usb device that stores your private keys. It never shows your computer those keys

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