Topic: question about wallets that use a different recieveing adress each time (Read 529 times)

 My reading comprehension is fine Danny.  I was chiding you for the superfluous nature of your statement on the sum of the inputs. 

 As I originally stated... In the simplest terms, if all of your coins have been received to the same address and you continue to send your change back to that same address, owning the private key for that address is crucial if you want to spend them so essentially, the coins have pooled together....

 So, near or far from your "mark", I can still move all my coins to one address with one private key and spend them as I see fit, receiving the change at that same address and effectively pooling my coins.  Which is demonstrated by the address in the txid I posted originally.  Somebody pooled 15o+ Bitcoins into one address.  Pooled.  Yep, I said Pooled. 

 It was intended as a simple explanation for the OP who was already having trouble understanding the wallet.  Now, after your bucket 'o gold rant, OP is probably more confused than ever.

 

Work on your reading comprehension.

They don't "amass from smaller units and give you a total which is greater than the sum of its parts".

They destroy smaller units and give you a new coin which is greater than any of the individual parts (and less than or equal to the sum of the parts).


If you want to say that transactions are a pooling of previously unspent outputs, then you'll be pretty close to what actually happens.

If you want to say that receiving multiple outputs to the same bitcoin address will result in the outputs being "pooled" into a single value at that address, then you're pretty far off the mark.

 Where in the world do things amass from smaller units and give you a total which is greater than the sum of its parts (Excepting in the mind of Aristotle)?  You're making a wonderful argument for the use of the term pooling, DannyHamilton. 

Technically, when you create a transaction the "unspent outputs" that are funding the transaction become "spent outputs" and can never again be used.  The transaction then creates new "unspent outputs" with new values.

If you think of the "unspent output" as a "coin", then the coin is effectively destroyed, and new coins are created to take their place.  The protocol makes sure that the total value of the new "coins" (unspent outputs) is never larger than the total value of the "destroyed coins" (spent outputs).

So the unspent outputs are never "pooled together" as they are received, but by sending them in a transaction you can "destroy" lots of little unspent outputs, and then create a single new larger unspent output that does not have a larger value that the sum of all the little outputs that funded the transaction.

Is there any benefit to using fewer addresses for receiving, or conversely to using more?

Since bitcoin tracks all coins individually anyway, except for maybe a cluttered wallet with a lot of address, what is the main advantage of using a new address for each transaction? Privacy, security?  This is something I have often read about, but never fully understood.

I would never recommend that anyone do that, but yes, if you always use the same address for receiving bitcoin and you always send the change back to the same address then "owning the private key for that address is crucial".  Also, making sure that nobody else has access to the private key for that address is crucial.


I guess that depends on what you mean by "pooled together".

Lets use an analogy...

A standard "bar of gold" is 12.4 kg.

If I send you 10 nuggets of pure gold that each weigh 1.24kg and you toss them all in a bucket as you receive them, you have ten 1.24kg nuggets in a bucket.  Are the "pooled togther"?  If you want to spend them, on something that costs 6.2kg of gold, you'll still have to hand over five separate nuggets.  (This is what happens when you receive separate bitcoin transactions. Each "nugget" is an output from a separate transaction and the "bucket" is your bitcoin address associated with those unspent outputs).  This is the sort of "pooling together" that happens when you receive separate transactions to the same address.

Now instead, if you want to buy something that costs 1.86kg of gold, you'll can melt together 2 of the nuggets (for a total of 2.48kg) and pour them into a 1.86kg sized mold and a 0.62 sized mold.  You can then toss the 0.62 sized chunk back into your bucket with the other eight 1.24kg sized pieces and give the 1.86kg sized piece in payment.  You now have in your bucket 8 pieces that are 1.24 kg in size, and 1 piece that is 0.62kg in size.  Meanwhile the recipient of the transaction has a new 1.86kg sized piece in his bucket.  (This is what happens when you send a bitcoin transaction.  Individual "nuggets", previously received outputs, are selected from the buckets.  They are listed separately as inputs to the transaction (the transaction is the "melter" that destroys the original inputs and lets you "pour" out newly formed outputs of new sizes).  This is the sort of "pooling together" that happens when you send a transaction.


Notice in the example, if you have 10 separate buckets, or just one bucket, it doesn't change the fact that you still have 10 separate lumps of gold.  A good wallet can easily keep track of as many buckets as you have outputs.


That address has never been re-used.  It has (as of the time of writing this post) only ever received a single transaction output and has never received any change from itself.

The creator of that transaction previously received a single 151.55267355 BTC output from someone.  They created a bucket (bitcoin address) that they named "1HTe9PK5wZSp2qXqn1yLFegGxj2Z3biW1X". Then when the sender melted together some of their own inputs to create a transaction, the sender poured out a single 151.55267355 BTC nugget that got tossed into that single "1HTe9PK5wZSp2qXqn1yLFegGxj2Z3biW1X" bucket.  Now when the owner of the 1HTe9PK5wZSp2qXqn1yLFegGxj2Z3biW1X bucket wants to spend some of that 151.55267355 BTC output, they created their own transaction that melted down and destroyed the 151.55267355 BTC output, and poured out two new outputs.  One was 0.3816135 BTC (which perhaps was sent to the recipient and stored in their own bucket labeled "1GKa5vmFXECfWQMF3C5rzufR2sto6e8r6a"), and the other was a 151.17096005 BTC output (perhaps of "change" that was tossed into a NEW bucket labeled "1PStiqfcYGkUu6p5QU3PCjmCdE1Ec744KC").

But are they considered pooled together after forwarding all the output to second address then to the third address as single output?

 In the simplest terms, if all of your coins have been received to the same address and you continue to send your change back to that same address, owning the private key for that address is crucial if you want to spend them so essentially, the coins have pooled together.
 
 If this were not the case, how would this transaction make use of an address which contains more than 50 coins (given that the initial mining reward was 50 coins)? 
txid:c27212a482cc4add5cbc51f131c1bd8fd3dc7d1fb058724f2268d819ddef3f07

NB.  I just pulled a recent transaction that made use of an address containing a large number of coins. (it has not necessarily been confirmed yet)

Coins never pool together.  Each output that you receive is listed separately as an input when it is used in a transaction. Even if you use a wallet that always uses the same receiving address, each output that you receive at that address is still tracked separately and individually listed as inputs when they are later spent.

You don't need to know how different wallets work to get to a hero level.
Moreover, even in the case of electrum, earlier versions didn't have coin control features. It is only later versions which implemented it.

Alley is already a Hero and he is just learning it now? 

Most hard drive wallet seem to work that way though, but sure you can set things up and i believe receiving address can just be one.

Don't know if wallets prioritize coins based on their age in an address or confirmations etc. but afaik wallet chooses addresses to send from randomly (unless specified otherwise).


Yes, Electrum has that feature also, you can choose from which addresses to "send from" when making the transaction. Although, not sure if phone wallets have this feature, I don't use any, maybe mycelium does.

 An excellent point yet I would suggest that since Alley is still learning, she/he should probably not try to use the wallet customizations until he/she is a little more knowledgeable about the workings of the wallet.  As we have seen in the past, people have mistakenly sent large transaction fees with their payment and Bitcoin is unforgiving of mistakes.  There are no take-backs!

To expand on this: There are wallets in which you can specify sending address(es) (custom input(s)) and a change address (for example in Bitcoin Core). I use this feature almost every single time when I transact.

Your wallet consists of all the addresses to which you have received.  When sending money, you will send from the combination of addresses that sum closest to the total you are sending.  The change will be returned into a new address in your wallet.

If you recieve multiple payments what adress do your coins end up in for spending?  I noticed my phne wallet does this and am confused on how it works and how your coins pool together.