Change addresses

[zeks1066]

Hi

Noob here. I was reading about how some people have lost bitcoins because they do not understand change addresses. These articles talked about the danger but did not explain the solution clearly.

Can someone help clarify the following for me:

1. Unspent coin goes to a change address. Can I specify this change address?, i.e. create a new wallet and direct the change there? If so, is there an opportunity during a payment transaction to specify the change address I want to use?

2. I've setup Electrum on Tails (the wallet lives in permanent storage). Will Electrum remember my wallet/transactions when I power down?

3. Does Electrum handle all the change/change addresses for me so I don't have to worry about it?

Thanks.

[btcdevil]

Hi

Noob here. I was reading about how some people have lost bitcoins because they do not understand change addresses. These articles talked about the danger but did not explain the solution clearly.

Can someone help clarify the following for me:

1. Unspent coin goes to a change address. Can I specify this change address?, i.e. create a new wallet and direct the change there? If so, is there an opportunity during a payment transaction to specify the change address I want to use?

2. I've setup Electrum on Tails (the wallet lives in permanent storage). Will Electrum remember my wallet/transactions when I power down?

3. Does Electrum handle all the change/change addresses for me so I don't have to worry about it?

Thanks.

Ya Electrum keeps record of all your address spent and not spent , even you can see that in which address how many transaction you have done and how much value you have spent on that address.

[HabBear]

Ya Electrum keeps record of all your address spent and not spent , even you can see that in which address how many transaction you have done and how much value you have spent on that address.

I suppose this is another benefit of online wallets, where they're doing the technical things and just making sure that your balance is accurate for saving or hodling. Online wallets are solidifying their purpose, their role in the bitcoin world.

To btcdevil, is change produced on every transaction?

[Coin-Keeper]

To btcdevil, is change produced on every transaction?

When you are using Electrum with change address enabled then YES you will NEVER use the same address twice in the wallet.  Every transaction will be sent and ANY change left over in the btc address being sent from will be sent to a generated change address.  This adds to privacy because the address will only appear in the blockchain one time.  Remember, the blockchain is public and if you repeatedly use the same btc address you will sacrifice privacy.  This different than security.  You can elect to use the same address an unlimited number of times (many donation sites do as an example) and your coins are still totally safe.  Privacy and Security are not the same in this case example.  Hope this all makes sense to you.

[Velkro]

I suppose this is another benefit of online wallets, where they're doing the technical things and just making sure that your balance is accurate

Until your balance will go to 0 coz online wallet get hacked.
I agree its easier thats why people use them, but at great risk of loosing theirs Bitcoins.
That is too high risk for me personally, i would never use online wallet.

I recommend software wallets, not mobile tho.

[kolloh]

Hi

Noob here. I was reading about how some people have lost bitcoins because they do not understand change addresses. These articles talked about the danger but did not explain the solution clearly.

Can someone help clarify the following for me:

1. Unspent coin goes to a change address. Can I specify this change address?, i.e. create a new wallet and direct the change there? If so, is there an opportunity during a payment transaction to specify the change address I want to use?

2. I've setup Electrum on Tails (the wallet lives in permanent storage). Will Electrum remember my wallet/transactions when I power down?

3. Does Electrum handle all the change/change addresses for me so I don't have to worry about it?

Thanks.

1. You cannot specify the change address via Electrum as far as I know. It is sent to a new random change address within your Electrum wallet. You could create a transaction that has no change though and redirect any extra coins in an input to an address of your choice by sending to multiple addresses at once.

2. I believe that data does not persists on Tails. You can restore your existing wallet at any time using the seed that is given during the creation though. I believe you would have to restore from seed on each use if using Tails.

3. Yes, Electrum handles all the change addresses for you so you don't need to worry about it. It will go to a change address within your Electrum wallet.

[zeks1066]

Thanks for your reply kolloh. Can you just explain this bit... Not sure I understand. Thanks

1.... You could create a transaction that has no change though and redirect any extra coins in an input to an address of your choice by sending to multiple addresses at once.

[Abdussamad]

3. Does Electrum handle all the change/change addresses for me so I don't have to worry about it?

This. When you use a software wallet like electrum then it'll handle change for you and you don't have to worry about it. Change is only a problem for paper wallet users or those who muckabout with private keys directly.

Since you've asked I'll answer your other questions too:

1. Unspent coin goes to a change address. Can I specify this change address?, i.e. create a new wallet and direct the change there? If so, is there an opportunity during a payment transaction to specify the change address I want to use?

The generic term for fine grained control over the inputs and outputs of a transaction is called "coin control". Electrum allows you to determine which inputs form a transaction but does not allow you to select where the change goes. Bitcoin Core allows you to do both.

What electrum does allow you to do is specify whether you want to use separate change addresses, which is good for privacy, or send change back to one of the originating addresses. So if you go to tools > preferences > transactions tab you can select to use change addresses or not.

2. I've setup Electrum on Tails (the wallet lives in permanent storage). Will Electrum remember my wallet/transactions when I power down?

Electrum on tails is an old version so I don't recommend using it. You should use a debian live cd and install the latest electrum on to that. Yes you can do that. The instructions for installing electrum on ubuntu/debian are on the download page of the electrum site.


BTW you've called electrum an online wallet. What do you mean by that? Electrum is not a web wallet or a wallet provided to you by some centralized entity. You control the private keys and they only exist on your own devices.

[kolloh]

Thanks for your reply kolloh. Can you just explain this bit... Not sure I understand. Thanks

1.... You could create a transaction that has no change though and redirect any extra coins in an input to an address of your choice by sending to multiple addresses at once.

If you wanted to make a payment to one address and send the change to some other address, you would create a multi-output transaction ( 2 destination addresses ). One output would be the destination address for your payment and the second address would be another address that you are sending the rest of the coins to. You would be spending the entire input and thus there wouldn't be any change left to go to a change address.