Hello intrigeri, Michael,

intrigeri wrote:
> Hi Michael,
> 
> Michael English:
>> It also helps to reduce blockchain UTXO (unspent transaction
>> outputs) bloat,
> 
> This makes me curious. How does this help with that property, exactly?
> My intuition tells me that by restricting the set of coins that can be
> spent to one single address, on the contrary, the software has fewer
> possibilities to optimize towards 1. reusing existing unspent outputs;
> and thus 2. avoiding to create more.
> 
> Also: where was this text quoted from?
> 

The text was copied from Electrum man page. The privacy coin chooser
will not offer 100% anonymity, because that's technically not possible
in a system using a public blockchain, but it will obfuscate information
about sender's total BTC holdings so it's a plus.

UTXO's are basically the coins you can spend. The spendable coins are in
UTXO's, not in addresses. Addresses are just a smart crypto way to let
the world know in advance who has the right to spend a given UTXO.

Existing unspent outputs cannot be reused, they are burned and re-crated
entirely every time. So you cannot spend part of a UTXO, you spend it
all (practice does not recommend re-using addresses - it's true nothing
keeps you from receiving the change in the same initial address that you
spent from, but you'll have a different UTXO).

>> Routing transaction relay through Tor is only part of the solution. The 
>> blockchain is
>> a public ledger that can be analyzed anytime after the initial transaction 
>> broadcast.
>> Private coin selection impedes correlation of transaction inputs and outputs 
>> that
>> could link back to an identity.
> 
> Sure. I hope our doc clearly states that it's very hard to use Bitcoin
> in a privacy-preserving way, for some various value of "privacy".
> 

Agreed, but the setting indicated by Michael could be shipped as a
default imho. It makes sense in a context like Tails/Tor threat model.

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