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Author Topic: Pros and cons of using new Bitcoin addresses for each transaction?  (Read 33109 times)
doublec
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October 09, 2010, 11:36:18 AM
 #21

It would be nice feature to physically remove entries from it if I'm pretty sure no one will send coins to that particular address. For example, if would be useful for shops which create one-time addresses to recieve payments.

The problem with deleting the address is, if the address was made public, someone can still send money to it. If you delete the address and bitcoins are later sent to it then those bitcoins cannot be recovered (as I understand it).
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Unlike traditional banking where clients have only a few account numbers, with Bitcoin people can create an unlimited number of accounts (addresses). This can be used to easily track payments, and it improves anonymity.
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eurekafag
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October 09, 2010, 05:13:48 PM
 #22

Try to read the post to its end before replying ^_~ Or at least read the second sentence:

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...if I'm pretty sure no one will send coins to that particular address.

More than that, I mentioned cases when it's just impossible (or not needed to) send to an address twice or more times.
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October 18, 2010, 01:21:04 AM
 #23

You could always pregenerate all the keypairs (addresses) you'd ever need and keep them in your wallet.
Satoshi made it by default in SVN 163 (0.3.13.3).

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November 10, 2010, 12:06:24 AM
 #24

I think the number of addresses is like 33^62 (26+26+10?) that's over 10^94.

It's not. It's 62^33, which is slightly over 10^59.

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MoonShadow
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November 10, 2010, 12:19:20 AM
 #25

The addresses are valid forever unless you lose your wallet.

The addresses are valid forever until someone else collides with your address.
This is not considered as a risk here. But that is not impossible.
And the more addresses generated, the less it is impossible Smiley


Generating new addresses for each transaction doesn't increase your risks of a collision.  The risk is not simply the risk of a collision alone, but also the maximum potential losses that such a collision could represent.  A single collision with one of your many addresses only exposes the coins associated with that particular address, not the total amount of bitcoins that said wallet.dat can access.  Reuse of addresses may limit your raw risks of a collision, but reuse also increases your maximum potential losses since more bitcoins are concentrated under fewer addresses over time.  Either way, the risks are so small as to be astronomically unlikely.  If a collision were to ever occur, even intentionally, it would be big news if someone could prove that it had occurred.

"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."

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November 10, 2010, 07:49:57 PM
 #26

I think the number of addresses is like 33^62 (26+26+10?) that's over 10^94.

It's not. It's 62^33, which is slightly over 10^59.
How did you arrive to this result?

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davux
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November 10, 2010, 10:21:15 PM
 #27

It's not. It's 62^33, which is slightly over 10^59.
How did you arrive to this result?

An address has 33 significant characters, each of which has 62 possible values (10 numbers, 26 uppercase letters, 26 lowercase).
So you have 62 * 62 * ... * 62 possibilities (33 times).

Actually, now that I remember, it's 58 (uppercase i and lowercase L are not included because they look too similar, same for zero and uppercase o).

So there are 58^33 possibles values, which is slightly more than 10^58. Still high, but not quite as high as 10^92.

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theymos
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November 10, 2010, 10:40:57 PM
 #28

An address has 33 significant characters, each of which has 62 possible values (10 numbers, 26 uppercase letters, 26 lowercase).
So you have 62 * 62 * ... * 62 possibilities (33 times).

Actually, now that I remember, it's 58 (uppercase i and lowercase L are not included because they look too similar, same for zero and uppercase o).

So there are 58^33 possibles values, which is slightly more than 10^58. Still high, but not quite as high as 10^92.

As ByteCoin already explained earlier in the topic, an address contains a non-data check code and version number. There are actually "only" 160 bits of randomness in each address: 2^160, or 1.46x10^48 possible addresses.

Addresses can also be 25-34 characters in length, depending on how numerically large the hash160+check code is (the larger it is, the more base58 characters required).

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grondilu
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November 11, 2010, 02:01:03 AM
 #29

How fast does wallet.dat size grow with creating new addresses? It would be nice feature to physically remove entries from it if I'm pretty sure no one will send coins to that particular address. For example, if would be useful for shops which create one-time addresses to recieve payments. If it's used once it's not needed anymore so the shop engine sends coins from that address to a certain fixed address and removes keys for that temporary one. It will prevent wallet.dat from growing indefinitely.

The size of your wallet is very unlikely to be a problem, imo.

If empty addresses realy bother you, you can create a new wallet and put all your bitcoins in it.  You could do that with a VM or using mybitcoin.com as a temporary storage.
Waterfox
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December 12, 2010, 10:39:22 PM
 #30

No real cons, just pros IMHO, but if you really needed the extra anonymity you could launder the coins.

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February 20, 2011, 04:22:36 AM
 #31

http://bitcoinwatch.com/http://bitcoinwatch.com/ has some of the info your looking for

Set up the same thing..
http://bit.ly/btcrefs
Get more bitcoins.
TimeMoney
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February 20, 2011, 06:08:04 AM
 #32

Can someone please give me a list of the pros and cons of using new Bitcoin addresses for each transaction? It seems very inconvenient to use a new address each time.

warning, I am a newbie...liked the videos presentations, did some research...and tried it.  Bitcoin.exe on an i7 --only application---24/7 x 10 days---on generate mode.  Only successful in the gratuitous .05 BTC from faucet per computer per public ip address.  I had plans to accept Bitcoins on all my websites...hired web developers  ...faced ZERO SUPPORT ANYWHERE. 

So question number ONE.  What happens to the Bitcoin if I don't use it, save it?  I speculate it ONLY serves to increase the value of those users and optimists who are "fan boys".  I have spent too much time...wasting...which cost me more money than I could have possibly made  in two weeks.

Question Number Two.  My PC's were set up by my SYSADMIN's.  After a few bouts of "actvity"....I ended up with 100% CPU on all cores...and the "connect" prompt  says unconnected.  Thats a lot of power and CPU cycles for Nothing...a big fat waste of time.  You want me to be impressed so we can get the concept moving?  Put up simple to understand "NOOB" isms...so that morons like myself...can learn HOW to connect.  If no connect...why the 100% CPU on all cores and NOTHING going on?  FOR DAYS?  I don't have time for games.  When you guys are serious...I'll be back.   I love all the concepts supporting it...but I will not GIVE AWAY valuable product from my websites for coins that have no value TO ME.

Explain it to me ---I want to trust...but I have seen nothing to make me want to trust.  10 MBPS uplink screaming PC's ...for NADA....

I understand the trade concept but who has the coins to buy what I have---real products with value--I even offered a discount to Bitcoin currency...but where is the beef? 



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jgarzik
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February 20, 2011, 06:44:53 AM
 #33

Can someone please give me a list of the pros and cons of using new Bitcoin addresses for each transaction? It seems very inconvenient to use a new address each time.

warning, I am a newbie...liked the videos presentations, did some research...and tried it.  Bitcoin.exe on an i7 --only application---24/7 x 10 days---on generate mode.  Only successful in the gratuitous .05 BTC from faucet per computer per public ip address.  I had plans to accept Bitcoins on all my websites...hired web developers  ...faced ZERO SUPPORT ANYWHERE.

Bitcoin definitely needs to grow some organizations that can offer technical advice and software support for bitcoin itself.  Most major open source projects have one or more companies doing this.  That would help with bitcoin adoption, too.

Quote
So question number ONE.  What happens to the Bitcoin if I don't use it, save it?  I speculate it ONLY serves to increase the value of those users and optimists who are "fan boys".  I have spent too much time...wasting...which cost me more money than I could have possibly made  in two weeks.

Bitcoin is a currency, literally, in its infancy.  The concept (distributed notary service with digital signatures) is, as far as I know, the first of its kind.  It is still being "bootstrapped," meaning that bitcoin does not have a self-supporting economy -- which must, by its nature, encompass mundane things like buying gasoline with BTC, paying rent or mortgage with BTC, buying groceries with BTC.

So, what can you do with the bitcoins you have right now?  Not a lot, if you ignore bootstrapping services (services like currency exchanges or bitcointo.com).  Mostly software services like web hosting, and an odd assortment of tangible goods.

But it seems like most folks in the bitcoin community recognize that we just started construction of a very interesting and unique experiment in currency.  Any endeavour is, unfortunately, very high risk from an investment standpoint.  It might fail for dozens of reasons...  but wouldn't be fun and interesting if it succeeded?

Quote
Question Number Two.  My PC's were set up by my SYSADMIN's.  After a few bouts of "actvity"....I ended up with 100% CPU on all cores...and the "connect" prompt  says unconnected.  Thats a lot of power and CPU cycles for Nothing...a big fat waste of time.  You want me to be impressed so we can get the concept moving?  Put up simple to understand "NOOB" isms...so that morons like myself...can learn HOW to connect.  If no connect...why the 100% CPU on all cores and NOTHING going on?  FOR DAYS?  I don't have time for games.  When you guys are serious...I'll be back.   I love all the concepts supporting it...but I will not GIVE AWAY valuable product from my websites for coins that have no value TO ME.

Step 1: Turn off "Generate coins" option.  It is a waste of time and electricity.

Step 2: Wait for all the blocks to download.  As of this writing, there are 109245 of them.

Step 3: Don't panic, and read the forums.  If you can post specific problems you are seeing after following steps #1 and #2, you can get answers.

Step 4: Hire better SYSADMIN's.  They should be able to answer these basic questions and offer basic support, or not install software that neither you or they understand.


Jeff Garzik, bitcoin core dev team and BitPay engineer; opinions are my own, not my employer.
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johnieeliang
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March 15, 2011, 03:49:10 PM
 #34

just a little bit more hassale but its not a biggie
CryptikEnigma
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March 24, 2011, 02:13:05 AM
 #35

I've noticed that my bitcoin client likes to create new addresses by itself, does this happen to anyone else?

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theymos
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March 24, 2011, 02:19:50 AM
 #36

I've noticed that my bitcoin client likes to create new addresses by itself, does this happen to anyone else?

It does that when you receive BTC on your active address, to encourage you to use a new one.

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CryptikEnigma
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March 24, 2011, 02:26:45 AM
 #37

I've noticed that my bitcoin client likes to create new addresses by itself, does this happen to anyone else?

It does that when you receive BTC on your active address, to encourage you to use a new one.

Oh okay, I can still get BTCs sent to any of my old ones though right? No matter which one is in my address bar?

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theymos
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March 24, 2011, 02:41:27 AM
 #38

Oh okay, I can still get BTCs sent to any of my old ones though right? No matter which one is in my address bar?

Yes.

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mcandre
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March 24, 2011, 06:32:27 PM
 #39

Correct me if I'm wrong, but changing the address after each transaction doesn't give you anonymity.

Conducting business with a known party is guilt by association in the eyes of the intelligence community.

A permanent trail of transactions is available, even searchable. Changing the address only makes the trail slightly harder to follow.

Moreover, the transactions are automatically sorted as normal and strange. Block Explorer is doing the FBI's job for them, so they can sit back and watch baddies trade.
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March 24, 2011, 06:53:01 PM
 #40

Correct me if I'm wrong, but changing the address after each transaction doesn't give you anonymity.

Conducting business with a known party is guilt by association in the eyes of the intelligence community.

A permanent trail of transactions is available, even searchable. Changing the address only makes the trail slightly harder to follow.

Moreover, the transactions are automatically sorted as normal and strange. Block Explorer is doing the FBI's job for them, so they can sit back and watch baddies trade.

You're right that it doesn't provide instant anonymity, but it does help. I've actually tracked people through transactions, and the constantly-changing addresses makes it much more difficult to follow. It prevents casual snooping, at least.

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