Homework on Role of Wallets - Questions

[Mauro]

@homiejohn

1. A Bitcoin wallet creates a private key, and then derives a public key or address. When you send a transaction the wallet broadcasts the digital signature of the sender to the network, so they other nodes or wallets can update the blockchain simultaneously.

A public address is a hashed version of a public key. Overall good answer.

[Mauro]

@Elizabeth

it keeps private keys that creates and signs transactions

That is the key feature of course. A wallet can have many more features as well. Some of them are, coin exchanging, showing your balance in USD or in satoshi values if you hold something else than just bitcoin, history of your transactions, etc.

[Mauro]

@Hermann

1. Wallet stores your private keys and stores transactions

The wallet does not store your transactions, the blockchain does. In order to move inputs from an address you need to sign a transaction with a private key that corresponds to that address. The private key enables you to tell other nodes that you are the owner of that address, meaning you can use all the inputs it has.

[Mauro]

@DeezSats

Basically it allows the user to interface with the blockchain.

I like this sentence a lot. For example https://www.myetherwallet.com/ is an interface to interact with the ethereum blockchain. Many people get confused what the website actual does. Its sometimes hard to explain it to someone, but you got it on point. Great job.

[Mauro]

Very nice homework. As Andreas Antonopoulos said: “Not your keys, not your bitcoins.”

[Mauro]

@JosieA

A Bitcoin Wallet is one of the safest methods of storing Bitcoin Private Keys and using them to make purchases or transfer Bitcoin as it is unable to be accessed by the internet.

I assume you are talking about a hardware wallet? There are many types/implementations of a bitcoin wallet. There is no one bitcoin wallet. Anyone can create it if they wish to do so. That being said, some are more safe than others. The one I already mentioned is the hardware wallet, which is far the most secure one, as signing the transaction happens on a device disconnected from the internet. The device only let’s the already signed transaction (digital signature) to be sent to other nodes. Hot wallets on the other hand are wallets that sign transaction on a device that is connected to the internet, such as computers or phones. They are riskier as the private key is always at risk from being seen by someone on the internet. And then there are online wallets, in which you rely on a third party to store your private key. You will learn more about this as you go on.

[Mauro]

@martjas

bitcoin wallet stores private key and public key, queries full node to obtain “balance” that is available to spend, signs transactions to spend assigned bitcoin and broadcast them to network

I wallet does not have to be an SPV but they usually are. A full node can also have a wallet.

[Mauro]

@Wevlin

stores your private keys and generally the wallet can also generate public keys for reception to the priv key

A wallet can always use the private key to know what your public address is. That way it can keep track of the funds of that address. You can always find a public key if you own the private key, but not vice versa.

[Mauro]

Very well said. Keep it up.

[Wevlin]

yes =) somtimes the wallets dont work right though!

[JosieA]

Thanks for the feedback! Appreciated.
Yes, I should have qualified my answer as being a hardware wallet! Live and learn

[Timothy]

1. Bitcoin wallet stores your private key and creates and signs transactions, receiving transactions, but is not storing any funds.

[Rob_McCourt]

1. A Wallet is used to sign TXs, create and sign TXs, broadcasts it to the network, and reads the Blockchain.

[cdurri]

@ivan

Describe in short what a bitcoin wallet does.

A Bitcoin wallet does the following

• Stores your private keys
• Creates and signs transactions
• Broadcasts transactions to the network
• Can connect to other nodes in the network in order to broadcast transactions to them
• When the wallet receives Bitcoin it will read the Blockchain and notify you that you have more Bitcoin to spend

[vale_dinap]

— My answers —

1. A bitcoin wallet stores a private key (either on a hardware support, a piece of paper, etc.) and uses it to sign the transactions. When a transaction has been signed, it broadcasts it to the network. It is important to notice that the wallet does not store the coins, as they are always on the blockchain (to be even more precise, there are no coins at all in the first place). The wallet can also check the available founds by either querying them from a full node (if SPV) or by running on a full node by itself.

[Misterpow]

A wallet connects to the blockchain containing private and public key. The wallet shows transactions that have run over these keys and the balance. There is no actual bitcoin in the wallet. The wallet is just the sign that points to the place in the blockchain.

[SpyrosGR]

It stores my private keys, create and sign transactions, brodcast them to peers and read the blockchain.

[Long]

A bitcoin wallet allows you store, send, receive and view updated cryptocurrency balances. It also holds your private keys, allowing you to digitally sign for transactions on the blockchain.

[knottymoose]

1. Describe in short what a bitcoin wallet does.
   A wallet stores your private keys and can access a copy of (or send a query to) the blockchain. When you send BTC it will create and sign the transaction using your private key, then send your transaction to the network. When receiving BTC it will read the blockchain and notify you when funds are available (updating your balance).

[CryptoMadis]

Wallet is one possible medium through which a user can communicate to a bitcoin network.
Wallet allows users to send and receive bitcoin transactions