Homework on Bitcoin Ecosystem - Questions

1 .SPV (simple payment verification) views UTXO on the blockchain for a
particular private key for that device, it also can transact.
A full node keeps a ledger of all the blockchain transactions it transmits and interacts on the network to keep the blockchain eco system running

2 . A transaction is broadcast means that the blockchain network receives a request from a node or miner that a transaction has been requested, these can come from a wallet, SPV , node or miner

3 .The miner pick the transaction from the mempool, which has the highest fees

  1. What is the difference between a SPV (simplified payment verification) and a full node?
    Full nodes hold the complete blockchain ledger whereas SPVs only hold a local version comprising there own transactions and must query a full node for data on UTXOs they don’t know about.

  2. What does it mean when a transaction is broadcasted?
    The transaction is added to the mempool and propagated across the network to await inclusion into the next block.

  3. How does a miner pick which transactions that gets added to the next block?
    Being financially incentivised, the miner will tend to include those transactions with the highest fees.

  1. An SPV is not a Node but communicates with Nodes to verify a transaction.

  2. It means the transaction has 6 or more confirmations on Nodes.

  3. It will choose the transactions with the highest transactions fee.

  1. SPV is a node with part of the blockchain on it

  2. It basically means shouting to everyone on the network that can hear that something is happening and the miners and nodes will validate it.

  3. the miners pick the transactions with the highest sat/B ratio first

1. What is the difference between a SPV (simplified payment verification) and a full node?
An SPV doesn’t contain all the transactions on the blockchain as a node does, it simply communicates with nodes to get information about the transactions.

2. What does it mean when a transaction is broadcasted?
The transaction is communicated to nodes who further propagate it to other nodes.

3. How does a miner pick which transactions that gets added to the next block?
The miner choses transactions with the highest transaction fees to maximize its profit.

  1. SPVs do not have a local copy of the blockchain. Full nodes do. If an SPV needs data from the blockchain, it will query a node.
  2. It is transmitted to the other nodes on the blockchain.
  3. The miner will pick the transactions with the highest transaction fees.
  1. SPV doesnt have a copy of the blockchain but can verify that transactions are in a block. spv requires much less data to operate (mobile)

  2. a transaction has been sent to the network for inclusion to the mempool and ultimately into the blockchain.

  3. miners will likely include the transaction with the highest fees.

  1. The SPVs are light weight nodes that does not have the full database. Normally they are simple wallets that query the full nodes on their behalf.

  2. All wallets when sending bitcoin first sign the transaction and subsequently broadcast the transaction to be picked up by the network nodes and placed temporary in the mempool. Broadcasting here means that copy of transaction is propagated into the whole network for miners to be picked up for mining.

  3. Miners because of being rewarded always pick the transaction that pays the highest fee.

  1. An SPV does not store the entire blockchain and generally queries a full node, which as the name implies, has the full chain, for the transaction data required to construct a transaction.

  2. When an SPV constructs a transaction it first gets transmitted to the closest node, then that node will propagate the transaction to other nodes, which includes miners. The transaction is being broadcasted over the network. Once that has happened it will either be added to the next block, or if that block is already at maximum capacity, be held in the mempool until it is integrated in a block.

  3. A miner favors to pick the transactions that have the highest fees per byte. Lower fee-per-byte transactions will have to wait for a block with free capacity.

  1. SPV does not verify transactions. It is doing less things than a full node.

  2. Transaction being stored into the mempool of node, waiting to be picked up by miner and put into the next block.

  3. It will based on the transaction will higher fee, so that they receive higher block reward if successfully mined.

  1. An SVP does not have a it’s own copy of the blockchain, it relies on a full node’s copy.
    An SVP can generate TX’s, as opposed to a full node.

  2. A wallet or an SPV puts a TX on the blockchain network.

  3. Miners pick the TX’s with the highest fees.

1.spv may contain some of the blockchain but maybe not all of it, it uses data off a node which contains the full blockchain.
2.its confirmed by all nodes and then added to the blockchain
3.a miner will pick transactions with the highest fee

What is the difference between a SPV (simplified payment verification) and a full node?
An SPV does not maintain full blockchain data. It holds the information necessary for processing
its own transactions and will inquire and verify transactions throufh a full node on the network.

What does it mean when a transaction is broadcasted?
The transaction is propagated to the network, is sent to mempools of nodes in the network until incorporated into a block. Then it is removed from the mempool.

How does a miner pick which transactions that gets added to the next block?
Miners are financially incentivized, they will select the highest satoshi per byte
transaction.

1 SPVs não possuem o registro de toda a blockchain, mantem apenas as transações relevantes e precisam consultar um full node para ter informações a respeito da blockchain, o full node possui todo o registro de transações da blockchain, tem informações sobre UTXO e verifica a coerência das transações na blockchain.

2 Quer dizer que a transação foi enviada para outros nodes.

3 Eles selecionam as transações do mempool e escolhem as transações com taxas mais lucrativas para preencher o espaço disnponível no bloco a ser minerado.

  1. A full node stores a local copy of the entire blockchain, making them able to validate transactions. An SPV does not store a local copy of the blockchain, but can still validate transactions, but by requesting other full nodes.

  2. When a transaction is broadcasted it means it has been put into the mempool, and that it’s ready to be mined for the next block by a miner.

  3. Miners takes the transactions from the mempool, descending by the biggest fee first.

  1. An SPV does not store all the Data so need s to communicate with a full node.
  2. When a a transaction is distributed across the whole network.
  3. Miners will always seek the highest transaction fee’s as it is in there interest to offset there costs.

Homework on Bitcoin Ecosystem - Questions

1. What is the difference between a SPV (simplified payment verification) and a full node?

A SPV is a wallet or device containing a users private key (PK) which allows the user to access blockchain ledger containing unspent transactions (UTXOs). An SPV combines sufficient UTXOs together complete the require transaction, but requires access to a full network node to broadcast this request with the unspent transactions returning to the users nominated output address.

A full node can include the users PK, normally does not for reasons of security. A full mode includes a copy of the entire blockchain ledger which records all confirmed transactions. A full node has the ability to transmit/propagate the blockchain through the network and contains a copy of the mempool - UTXOs. A full mode also provides access to miners who produce/hash the next block within the blockchain ledger.

2. What does it mean when a transaction is broadcasted?

The SPV or full node has confirmed via concensus the requested transaction is valid, and has combine sufficient input UTXOs together complete the transaction for broadcast to the blockchain network.

3. How does a miner pick which transactions that gets added to the next block?

The miner accesses a full node’s mempool selecting UTXOs to combine together which produce the highest blockchain transaction fee. The selected UTXOs are hashed together based; on the previous hashed blockchain plus a random number to produce a hashed block number which is below the network’s target number for inclusion within the blockchain.

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  1. The difference between a SPV (simplified payment verification) and a full node is that the SPV has not downloaded all the transactions and need to consult a full node each time for verification, because the full node has downloaded and verified all the transaction.

  2. A transaction is broadcasted by a wallet to the queue (mempool) in order to be included into a future block of the blockchain.

  3. A miner picks the transactions that gets added to the next block, by choosing the ones that have the highest fees, in order to get a bigger reward.

1.An spv runs off a full node for mobile phones so they have accesss to the network without having to have the whole ledger on their phone. A full node has the whole ledger.
2.A wallet requests to send a transaction then a node picks it up and propagate that transaction to other nodes and miners.
3.The transactions with the highest fees are usually the ones that get picked up first but other miners and nodes may pick different transactions based on the transactions in the mempool at the given time.

  1. What is the difference between a SPV (simplified payment verification) and a full node?

SPV does not have a copy of the ledger. It simply get a transaction info from a full node that has a copy of the blockchain.

  1. What does it mean when a transaction is broadcasted?

This means that nodes on the network are informed of the new transaction in order to add it to their mempool.

  1. How does a miner pick which transactions that gets added to the next block?

Miners check node mempools for transactions that have the highest transaction fee.