hELp mE uDeRStaNd di$ biTcoIN TRanSactioN plEase!

[TonyT]

I am using BlockChain.info as my online wallet.

I received 20 mBTC from somebody (that's 0.00020 BTC), and it went to my Bitcoin wallet residing in Blockchain.info

Here is that transaction:

 https://blockchain.info/tx/ab26e27cac9252a676d1665de2cb49196399fdb40d534bb6f28f9a2adf104815

What I don't understand is, in bold:

(1) why did it take so much money to transfer this tiny amount of 0.0020 = 2.0 mBTC, and why the amounts do not add up specifically:

Inputs and Outputs
Total Input   0.00239289 BTC  82 cents
Total Output   0.00229289 BTC   78 cents
Fees   0.0001 BTC  about 4 cents
Estimated BTC Transacted   0.002 BTC  <--but I only got 68 cents, why was 10 cents taken?  By the miners?  But I thought this was the "Fee" of 0.0001 BTC?

(2)  Next, I decided to send some of this money to another online wallet that I have.  The address is here: 12sa4kdJGjBU3amUn3GsLYmMYq1Nd6G5Xy   

Here is the record of that transaction: 
https://blockchain.info/address/12sa4kdJGjBU3amUn3GsLYmMYq1Nd6G5Xy

what is strange is:  I sent 0.4 mBTC (0.00040), and I got it almost instantly, but Blockchain.info shows it cost 0.0014 BTC !  Why do much money taken for the transaction?

(3) Further, as a privacy violation, the entire world seems to be seeing my balance in my wallet: https://blockchain.info/tx/2282f8922119c3d6900450695af0926dfeaba4e3818ebf93d5c60ac15e9183f5 
(0.0006 BTC left)

How does the entire world know that I received 2.0 mBTC, sent 0.4 mBTC, and am only left (of the original 2.0 mBTC) with only 0.6 mBTC?  Is that supposed to be public knowledge?  And, as before, why are such big amounts taken from my initial sum, just for sending small micropayments?

I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?

Until I get answers to this question I will be very afraid of using BTC.

[EternalWingsofGod]

Hmm probally just had the inputs broken up into pieces
See change
https://en.bitcoin.it/wiki/Change

When the output of a transaction is used as the input of another transaction, it must be spent in its entirety. Sometimes the coin value of the output is higher than what the user wishes to pay. In this case, the client generates a new Bitcoin address, and sends the difference back to this address. This is known as change.

Take the case of the transaction http://blockchain.info/tx/0a1c0b1ec0ac55a45b1555202daf2e08419648096f5bcc4267898d420dffef87, a 10.89 BTC previously unspent output was spent by the client. 10 BTC was the payment amount, and 0.89 BTC was the amount of change returned. The client can't spend just 10.00 BTC out of a 10.89 BTC payment anymore than a person can spend $1 out of a $20 bill. The entire 10.89 BTC unspent output became the input of this new transaction and in the process produced are two new unspent outputs which have a combined value of 10.89 BTC. The 10.89 BTC is now "spent" and effectively destroyed because the network will prevent it from ever being spent again. Those unspent outputs can now become inputs for future transactions.

In this transaction, the fee is 0 but if there was a tx fee paid it would be the difference between the inputs and the outputs. (i.e. 10.89 BTC input and a 10.88 BTC output = 0.01 BTC fee).

In other words the balance is there
Blockchain is a rough measure the amount in an address may not be exactly the total amount that's actually in there because everytime a transaction is spent change is created and put in another address
When they are added back together they become a full balance.

[TonyT]

Hmm probally just had the inputs broken up into pieces
See change
https://en.bitcoin.it/wiki/Change
 

Ok that makes sense, thank you.  Can you tell me whether it's possible to combine tiny BTC amounts in your wallet and spend them?  Say you have ten 0.00010 BTC amounts, can you make them into one 0.0010 BTC?

Also you did not answer this part, do you care to?

"How does the entire world know that I received 2.0 mBTC, sent 0.4 mBTC, and am only left (of the original 2.0 mBTC) with only 0.6 mBTC?  Is that supposed to be public knowledge?  And, as before, why are such big amounts taken from my initial sum, just for sending small micropayments?

I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?"

[hilariousandco]

All transactions and balances are public knowledge; that's how the blockchain works. You can use a mixing service or send money to a dicesite or something then back to a new address if you don't want people to know how much you have, but you're never going to be able to truly hide your balances or transactions.

[TonyT]

All transactions and balances are public knowledge; that's how the blockchain works. You can use a mixing service or send money to a dicesite or something then back to a new address if you don't want people to know how much you have, but you're never going to be able to truly hide your balances or transactions.

Thanks hilariousandco!  Now the final piece of the puzzle, the last question unanswered:
I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?"

If it's because of Blockchain.info's fees, I understand, though I thought the only fees when transmitting bitcoins were the 0.0001 BTC minimum recommended transaction fees (or sometimes 0.0002 if use an online wallet like Multibit).  Is it possible Blockchain.info is adding something on top of these fees? (if so, they sure don't advertise it much to new customers like me).

TonyT

[EternalWingsofGod]

Hmm probally just had the inputs broken up into pieces
See change
https://en.bitcoin.it/wiki/Change
 

Ok that makes sense, thank you.  Can you tell me whether it's possible to combine tiny BTC amounts in your wallet and spend them?  Say you have ten 0.00010 BTC amounts, can you make them into one 0.0010 BTC?

Also you did not answer this part, do you care to?

"How does the entire world know that I received 2.0 mBTC, sent 0.4 mBTC, and am only left (of the original 2.0 mBTC) with only 0.6 mBTC?  Is that supposed to be public knowledge?  And, as before, why are such big amounts taken from my initial sum, just for sending small micropayments?

I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?"

To answer the first question.

Bitcoin does it automatically when it gathers the change it searches for the unspent outputs then lumps them all together to make that 0.001
(Assuming they are all in the same wallet of course)
(If you wait long enough and get coin age you can do it for free but its a factor of time and priority on the network so the fee speeds it up)

__

Second Part
(small error) 1.6 I believe not 0.6

It's confirmed in the blockchain the ledger records that you recieved 2.0 mbtc from someone then it records that you sent 0.4 mbtc to someone else and deducts that amount from the ledger so the amount of unspent transactions is 1.6 mBtc. The miners all observe this transaction and confirm that you sent it to Bob and he recieved the balance. So yep the record of the transaction is recorded and public knowledge, the person behind the address is unknown usually hence psuedo anonymous.

And with small amounts the transaction fee would probally eat the remainder.
As  mintxfee  0.0001 (BTC)  
https://en.bitcoin.it/wiki/Transaction_fees

Sending

A transaction may be safely sent without fees if these conditions are met:
## It is smaller than 1,000 bytes.
## All outputs are 0.01 BTC or larger.
## Its priority is large enough (see the Technical Info section below)

Otherwise, the reference implementation will round up the transaction size to the next thousand bytes and add a fee of 0.1 mBTC (0.0001 BTC) per thousand bytes[1]. As an example, a fee of 0.1 mBTC (0.0001 BTC) would be added to a 746 byte transaction, and a fee of 0.2 mBTC (0.0002 BTC) would be added to a 1001 byte transaction. Users may increase the default 0.0001 BTC/kB fee setting, but cannot control transaction fees for each transaction. Bitcoin-Qt does prompt the user to accept the fee before the transaction is sent (they may cancel the transaction if they are not willing to pay the fee).


Also as a note
If your using an older Bitcoin client it has a higher default transaction fee than the new ones
So its possible it used 1 MBTC as the fee.

https://bitcointalk.org/index.php?topic=219504.0
From 0.8.2 onwards fee dropped from 0.0005 to 0.0001

[hilariousandco]

Thanks hilariousandco!  Now the final piece of the puzzle, the last question unanswered:
I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?"

If it's because of Blockchain.info's fees, I understand, though I thought the only fees when transmitting bitcoins were the 0.0001 BTC minimum recommended transaction fees (or sometimes 0.0002 if use an online wallet like Multibit).  Is it possible Blockchain.info is adding something on top of these fees? (if so, they sure don't advertise it much to new customers like me).

TonyT

You can choose to set the fee yourself in the options or let blockchain.info suggest and automatically apply the fee for you. You can even send some transactions for free though they will take a while longer to confirm, though it won't be possible to do this with tiny dust transactions. Also, please note that blockchain.info and the Blockchain are two different things. Blockchain.info doesn't recieve any fees for their service but the fees you pay go to the miners.

[dooglus]

I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?"

If you look at the transaction in question:
  https://blockchain.info/tx/2282f8922119c3d6900450695af0926dfeaba4e3818ebf93d5c60ac15e9183f5
you see that a fee of 0.001 BTC was given to the miners.

Blockchain.info themselves didn't get anything from you - but for some reason their wallet decided to pay around 10 times the usual fee of 0.0001 BTC.

I don't use their wallet myself, but seem to remember they have a setting for how much fee to include. Did you perhaps select the "generous" setting? I can't think why else they would include so big of a fee.

Note, by the way, that fees are pretty much constant, no matter how much value you are sending. A fee of 10 cents to send 30 cents worth of coins sounds very expensive, but if you were to send a million dollars worth of coins, the fee would still be just 10 cents. It takes the miners the same amount of work to mine a 30 cent transaction as it does for them to mine a million dollar transaction, and they both take up the same amount of space in the blockchain too - so they cost you the same in fees (roughly speaking - sizes and fees do vary based on how many inputs the transaction consumes, and various other factors; there are rules about compulsory fees for sending small amounts to prevent people from sending thousands of tiny "spam" transactions and blocking up the pipes, too).

Edit: See this transaction in which I sent 38,000 BTC without paying any fee at all.

Edit2: About your privacy concerns: while it's true that everyone can see the "balance" at any given Bitcoin address, if you don't tell us which addresses you own, we won't know how many coins you own. Blockchain.info's wallet has the nasty habit of reusing the same address over and over, but if you make a new address for each transaction you do, it becomes harder for people to connect "TonyT" to the blockchain. We'll be able to see coins moving from address to address, but we won't be sure which addresses belong to you.

[TonyT]

Hmm probally just had the inputs broken up into pieces
See change
https://en.bitcoin.it/wiki/Change
 

Ok that makes sense, thank you.  Can you tell me whether it's possible to combine tiny BTC amounts in your wallet and spend them?  Say you have ten 0.00010 BTC amounts, can you make them into one 0.0010 BTC?

Also you did not answer this part, do you care to?

"How does the entire world know that I received 2.0 mBTC, sent 0.4 mBTC, and am only left (of the original 2.0 mBTC) with only 0.6 mBTC?  Is that supposed to be public knowledge?  And, as before, why are such big amounts taken from my initial sum, just for sending small micropayments?

I am left with 0.6 mBTC (in my Blockchain.info wallet) + 0.4 mBTC (in my online wallet) = 1.0 mBTC out of a initial sum of 2.0 mBTC, so half my money was taken by the miners in just one micro transaction?"

To answer the first question.

Bitcoin does it automatically when it gathers the change it searches for the unspent outputs then lumps them all together to make that 0.001
(Assuming they are all in the same wallet of course)
(If you wait long enough and get coin age you can do it for free but its a factor of time and priority on the network so the fee speeds it up)

Thanks but I was asking whether your online wallet can do this, not the bitcoin network and/or bitcoin core, that is, whether Multibit or Electrum can combine a bunch of smaller amounts into one big amount; i trust they can.

__

Second Part
(small error) 1.6 I believe not 0.6

No small error, in fact I lost 1 mBTC. I've double and triple checked.

It's confirmed in the blockchain the ledger records that you recieved 2.0 mbtc from someone then it records that you sent 0.4 mbtc to someone else and deducts that amount from the ledger so the amount of unspent transactions is 1.6 mBtc. ACTUALLY IT IS 0.6 mBtc--TonyT The miners all observe this transaction and confirm that you sent it to Bob and he recieved the balance. So yep the record of the transaction is recorded and public knowledge, the person behind the address is unknown usually hence psuedo anonymous.

And with small amounts the transaction fee would probally eat the remainder.
As  mintxfee  0.0001 (BTC)  
https://en.bitcoin.it/wiki/Transaction_fees

 
Also as a note
If your using an older Bitcoin client it has a higher default transaction fee than the new ones
So its possible it used 1 MBTC as the fee.

https://bitcointalk.org/index.php?topic=219504.0
From 0.8.2 onwards fee dropped from 0.0005 to 0.0001

I downloaded the latest copies of Multibit and Electrum, and am using them to receive.  But in this case I sent from Blockchain.info, and perhaps they have a minimum fee of 1 mBTC.  

Thanks for your reply.

[TonyT]

Blockchain.info themselves didn't get anything from you - but for some reason their wallet decided to pay around 10 times the usual fee of 0.0001 BTC.

I don't use their wallet myself, but seem to remember they have a setting for how much fee to include. Did you perhaps select the "generous" setting? I can't think why else they would include so big of a fee.

YES!  dooglus you are a genius detective.  I am logged off BlockChain.info now, and will check my settings later, but as I recall when I set up the account I checked the "generous" checkbox thinking it would speed up transactions (since I had read that some BTC transactions take 1 hour to confirm.

So you solved it, I'm 99% sure that is what happened.

TonyT

[dooglus]

Thanks but I was asking whether your online wallet can do this, not the bitcoin network and/or bitcoin core, that is, whether Multibit or Electrum can combine a bunch of smaller amounts into one big amount; i trust they can.

No wallet that I know of will combine a bunch of small amounts into a single big amount until you go to spend them.

When you tell the wallet to send an amount to an address it will look at all the amounts you have and work out which ones to lump together to make the amount you want to send. Usually it won't find outputs that add up to exactly the right amount, so it will pick a bunch of outputs which add up to a little more than you're trying to spend, and will create a transaction that sends the amount you want to the address you gave it, and that sends the rest back to an address you control, as "change".

If you want to combine all your bits of coins into a single large output, you can tell the wallet to send your entire balance to your own address. But it's not a good idea to do so - it's better to keep your coins in separate smaller outputs.

Suppose you have two 1 BTC outputs, and want to send 0.5 to two different addresses. You can immediately do this. Each send will use one of the 1 BTC outputs and send 0.5 BTC back to yourself as change.

On the other hand, if you had combined those two 1 BTC outputs into a single 2 BTC output, and wanted to send 0.5 to two different addresses, you wouldn't be able to immediately. You'd send the first 0.5 BTC, it would use the 2 BTC output and send 1.5 BTC back to you as change, but that change would be unconfirmed until the transaction was mined. Maybe your wallet lets you spend unconfirmed change, but if it doesn't you're going to have to wait for the change to confirm before you can send the second 0.5 BTC. And even if it does let you send unconfirmed change, the recipient of the 2nd transaction will need to wait for the first transaction you made to confirm before his transaction will confirm - the 2nd transaction spends the change from the 1st one, and so is dependent upon it.

tldr: you can combine your outputs, but you probably don't want to

[dooglus]

YES!  dooglus you are a genius detective.  I am logged off BlockChain.info now, and will check my settings later, but as I recall when I set up the account I checked the "generous" checkbox thinking it would speed up transactions (since I had read that some BTC transactions take 1 hour to confirm.

OK, so by checking 'generous' you made sure that your transactions get a big fee attached to them, which in turn means that the miners are going to include your transaction in blocks in preference to other ones with smaller fees.

But blocks are only found on average every 10 minutes or so, and sometimes we can go an hour without seeing a block at all, just due to bad luck. When that happens it doesn't matter how much fee you included. The big fee makes the miners try to include your transaction in a block, but if they can't find a block it doesn't matter how much you pay them, your transaction doesn't get confirmed until they find a block.

If you pay too small of a fee, you run the risk of the miners not bothering with your transaction even if they do find a block.

[Josepht]

This kinda surprises me. You are a full member. You should know how these things works.

[tanaka]

This kinda surprises me. You are a full member. You should know how these things works.

LOL.. and the way he writes his title is kinda weird. This just means that there is a lot of trolls here in btctalk

[TonyT]

This kinda surprises me. You are a full member. You should know how these things works.

LOL.. and the way he writes his title is kinda weird. This just means that there is a lot of trolls here in btctalk

I'm not a troll, just a noob.  And of course the title was deliberate, along the lines of a Eternal September* noob post. 

TonyT

*  just in case --you can never assume these days--you don't know what this phrase means:  http://en.wikipedia.org/wiki/Eternal_September 

[kassadin]

all bitcoin transaction is based on a miner finding your bitcoin.

which also known as miners fee.

[dooglus]

I'm not a troll, just a noob.  [...]

*  just in case --you can never assume these days--you don't know what this phrase means:  http://en.wikipedia.org/wiki/Eternal_September 

This makes me think that you're the opposite of a noob - an olld perhaps?

[TonyT]

I'm not a troll, just a noob.  [...]

*  just in case --you can never assume these days--you don't know what this phrase means:  http://en.wikipedia.org/wiki/Eternal_September 

This makes me think that you're the opposite of a noob - an olld perhaps?

olld? Is that a word?

http://olld.com/page/4/ <--  yes, an olld!  (Funny videos involving old people page)

[EternalWingsofGod]

This kinda surprises me. You are a full member. You should know how these things works.

I wouldn't expect all Full Members to get the technicals such as change, unspent tx ID's etc need a few Turr Demester Videos and Andreas Antopoulos videos to get a better idea of that  
But I did learn something apparently Blockchain has a generous function to speed up transactions and it can be pretty generous, although on average its still going to be in the same block most times with a normal fee or if its a large enough amount no fee.
Live and learn  

[axel2078]

All transactions and balances are public knowledge; that's how the blockchain works. You can use a mixing service or send money to a dicesite or something then back to a new address if you don't want people to know how much you have, but you're never going to be able to truly hide your balances or transactions.

Yep..what he said.  The best way to "hide" how much YOU have is by not going on the internet and letting everyone know what YOUR bitcoin address is. Yeah, everything you do will still be recorded in the block chain, but as long as you don't make it obvious that those transactions are yours, who cares?