Topic: What are the change addresses for? (Read 1168 times)

Thanks, that's a very helpful explanation!

Found this, not sure if it helps your particular case.

What is a "Change Address", and why is it useful?
The concept of change addresses is a feature not of the Bitcoin protocol, but of a Bitcoin client. It is implemented not only in Electrum but in most Bitcoin clients, including the original "Satoshi" Bitcoin client.
How it works:
Whenever your Bitcoin client (e.g. Electrum) sends Bitcoins from your wallet's address "A" to a foreing address "B", a new change address "C" is created by Electrum and added to your wallet.
Example: Address "A" has 20 BTC. Electrum sends 9 BTC from "A" to "B". The change (20-9 = 11 BTC) is sent to the "change address" "C". For this purpose, address "C" is created by Electrum at this moment and added to your wallet.
Exception: If all the Bitcoins of "A" are sent to "B", there is no need for creating a change address "C".
Actually, Bitcoin clients can also work without change addresses. In this case, the change would be sent back to "A" instead of the new address "C".

Why the concept of "change addresses" is useful:
Using a new change address makes it more difficult for other people (by analyzing the blockchain) to track how many Bitcoins you have or where you're spending them.
It also conceals which output is the "spend" and which is the "change".

@btcven: You're right when you have said that "You can't send 1 BTC + 0.0001 as fee as you only have 1 BTC in the wallet". I made a mistake in my formulation. Let me rephrase, it should be: I made a transaction of 0.9999 BTC + 0.0001 BTC as fee to "receive address" C, and the result was 0.9998 BTC in "receive address" B and 0.0001 BTC in "change address" C. Why is there 0.0001 BTC in the new "change address" C? What should I do now? Freezing "receive address" C and executing a transaction of 0.0001 BTC to "receive address" C?

The amount you send - the fee = change

The change is sent to a change address to obfuscate your payments and avoid the tracing of your transactions to you.

You can't send 1 BTC + 0.0001 as fee as you only have 1 BTC in the wallet. So what it looks like is that you sent 0.9998 to receiving address B and 0.0002 as fee. Check the info of the transaction (secondary click) to see the details.

I'm quite new to Electrum, and I don't understand the behavior in the last transaction.

Say I have 1 btc in the 'change address' A of Electrum, all other addresses are empty. Then I have made a transaction of 1 btc to 'receive address' B with a fee of 0.0001 btc. After that electrum shows 0.9998 btc in 'receive address' B and 0.0001 btc in 'change address' C.

I should mention that I have "use change addresses" enabled in the gui client.

What happened??? I know that 0.0001 btc was spent as a fee, but why is another 0.0001 btc transferred to another change address?

Can anyone explain it?