Transactions

Definition 10.1 (UTXO)

An Unspent Transaction Output (UTXO) is a transaction output that has not yet been consumed as an input to another transaction. Each UTXO represents a discrete amount of bitcoin locked to a specific spending condition.

Definition 10.2 (Transaction)

A transaction is a data structure containing:

1. Version (4 bytes): Protocol version number
2. Inputs (variable): List of transaction inputs
3. Outputs (variable): List of transaction outputs
4. Locktime (4 bytes): Earliest time/block for inclusion

Definition 10.3 (Locktime)

The locktime field specifies the earliest time a transaction can be included in a block:

• If locktime < 500,000,000: interpreted as a block height
• If locktime ≥ 500,000,000: interpreted as a Unix timestamp
• If locktime = 0: no restriction (immediately valid)

Definition 10.4 (Transaction Input)

A transaction input consists of:

1. Outpoint (36 bytes): Reference to the UTXO being spent
   • Previous txid (32 bytes)
   • Output index (4 bytes)
2. ScriptSig (variable): Unlocking script (empty for SegWit)
3. Sequence (4 bytes): Sequence number for replacement/locktime

a1b2c3d4e5f6...789012345678abcdef

# txid (32 bytes, reversed for little-endian)
efcdab78563412...f6e5d4c3b2a1
# output index (4 bytes, little-endian)
01000000

Definition 10.5 (Transaction Output)

A transaction output consists of:

1. Value (8 bytes): Amount in satoshis (little-endian)
2. ScriptPubKey (variable): Locking script defining spending conditions

Definition 10.6 (Satoshi)

A satoshi is the smallest unit of bitcoin:

1 BTC = 100,000,000 satoshis = 10⁸ satoshis

All values in Bitcoin are represented internally as integer satoshis.

1,000,000 = 0x0F4240

# As 8-byte little-endian:
40420f0000000000

Definition 10.7 (P2PKH ScriptPubKey)

A P2PKH output has the locking script:

OP_DUP OP_HASH160 <20-byte-pubkey-hash> OP_EQUALVERIFY OP_CHECKSIG

In hex: 76a914{hash}88ac

Definition 10.8 (P2SH ScriptPubKey)

A P2SH output has the locking script:

OP_HASH160 <20-byte-script-hash> OP_EQUAL

In hex: a914{hash}87

Definition 10.9 (Witness Program)

A native SegWit output has a scriptPubKey of the form:

<witness-version> <witness-program>

For P2WPKH: 0014{20-byte-hash}
For P2WSH: 0020{32-byte-hash}

Definition 10.10 (P2TR ScriptPubKey)

A Taproot output has the locking script:

OP_1 <32-byte-x-only-pubkey>

In hex: 5120{pubkey}

Definition 10.11 (Witness)

The witness is a separate data structure containing the signatures and other data needed to validate SegWit inputs. It is not included in the transaction hash (txid) but is included in the witness transaction hash (wtxid).

Definition 10.12 (Txid and Wtxid)

The txid is the double-SHA256 hash of the "legacy" serialization (version, inputs, outputs, locktime)—excluding marker, flag, and witness.

The wtxid is the double-SHA256 hash of the complete serialization including witness data.

Definition 10.13 (Sighash Types)

Bitcoin defines the following signature hash types:

Definition 10.14 (Transaction Fee)

The transaction fee is the difference between total input value and total output value:

fee = Σ(input values) − Σ(output values)

Fees are typically measured in satoshis per virtual byte (sat/vB).

Definition 10.15 (Transaction Weight)

The weight of a transaction is:

weight = (base size × 3) + total size

where base size excludes witness data and total size includes it.

The virtual size (vsize) is:

vsize = ⌈weight / 4⌉

Definition 10.16 (Coinbase Transaction)

A coinbase transaction is the first transaction in every block. It has:

• Exactly one input with a null outpoint (32 zero bytes + 0xFFFFFFFF)
• ScriptSig containing arbitrary data (the "coinbase" field)
• Outputs that may claim the block reward plus fees