Why Does My Bitcoin Wallet Address Change?

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A bitcoin document accompanied by a pencil, exploring the phenomena of changing bitcoin wallet addresses.
Table of Contents
A bitcoin document accompanied by a pencil, exploring the phenomena of changing bitcoin wallet addresses.

Key Takeaways:

  • Bitcoin wallet addresses change frequently to enhance security and privacy
  • Changing Bitcoin wallet addresses protects privacy by making it more difficult for others to trace transactions and link them to your identity
  • Bitcoin wallet addresses are permanent and can be reused

Why Does My Bitcoin Wallet Address Change?

If you are getting started with Bitcoin, you may have noticed that your Bitcoin wallet address keeps changing.

This happens for several reasons. 

The most important reason for this is security. Because of the public ledger, everyone can check all existing addresses and their balance. 

If an address has a higher balance, a hacker could target this for a potential hack. If you distribute your funds over several addresses, a hacker not only can discover just a small part of your funds, he would further need to discover all the remaining ones. 

The likelihood of finding all addresses you could have is extremely small, if you are careful with your data. The risk of losing everything if you send funds is minimized if you spread it over multiple addresses. 

Another important factor is privacy, which goes hand in hand with the security aspect. Nowadays, it can be relatively easy to trace people and connect different information to them because of the internet.

Bitcoin works over the internet so it is always a potential target for cybercriminals. 

If someone would manage it to connect a public address to your person through social media etc., then he would know what amount of funds you have and where you have stored it. 

If you now would use dozens of addresses instead of only one, then strangers would need to find all your addresses to know what amount of funds you have. The more addresses, the harder you can make it to track or steal all your funds

This was done to protect your privacy. Because of these advantages, wallets assign new addresses for every operation you make automatically. In your wallet software, you can always tell your overall sum. 

They are just divided over several addresses to give you the security benefits. Another advantage of this method is that you can easily separate your funds for different scenarios, like for everyday use or investing money. 

With a bank account, you would have to open a new one every time you would like to separate your cash. This is inconvenient and comes with costs. Using Bitcoin, you can create new addresses in seconds without costs.

How Often Does Bitcoin Wallet Address Change?

A wallet never changes addresses. 

Once created, an address is permanent. 

Changing them would contradict the use case of the blockchain. It saves all information in it about how many bitcoins belong to which address. This address acts like a bank account number. 

If the account numbers would be deleted, this would create an outrageous amount of address “fluctuation” which is hard to track and inconvenient. These deleted addresses could have stored bitcoins on them, too. 

Without a central authority, which could take the coins to them, they could just be deleted as well. It wouldn’t make sense to proceed this way. 

Another reason an address generated by your wallet is permanent is that once created, it can be used forever. 

Why should we delete an already created address and have more work to track these changes in the Bitcoin blockchain as well? If you need a new address, you can just easily create one. 

Of course, the new address wouldn’t have any cryptocurrency on it. It’s like you would open a new bank account with a new account number. There wouldn’t be any money on it, you first would have to transfer something to it. 

With Bitcoin this process is much easier. But instead of having separate accounts, all your addresses connect to one wallet and are therefore under one roof. You would have one account (wallet) with several sub-accounts (addresses).

How Do I Change My Bitcoin Wallet Address?

Within your wallet, you have the option to let the wallet create a new address for you. 

You would to this in 4 steps:

  • You would go into the options of a wallet software or web interface of your wallet provider.
  • You then commonly have the option to “receive bitcoins” which would create you a new address.
  • Click on “Generate new address” to let the address be displayed to you.
  • Copy that address instead of typing it to omit errors for further use.

This process would not really change your address, it would give you just a new address. You can’t change your address, it is not removable. From a mathematical perspective, it even exists already.

The hashing algorithm RIPEMD-160 used for the creation of addresses can give us 2^160 possibilities. This means that all the unique addresses are already there because they are mathematically possible. They just aren’t used.

The generation of addresses gives you one of these addresses. This is also one reason that if you send bitcoins to a wallet address which you typed incorrectly, the operation can be performed and is then not reversible.

Your bitcoins will then be sent to another actual address. Maybe this other proper address was just not created by anyone yet, so maybe no one will ever get access to the bitcoins you accidentally sent to it.

That is the reason you should always double-check every address you use. Bitcoin transactions are not reversible.

How to Generate a New Bitcoin Wallet Address on Blockchain?

You can create a new wallet address on the blockchain itself with their own software, called “Bitcoin Core”. 

It works the same way as with other service providers to create a new address. 

The process is relatively simple as your wallet allows you to create them easily. You would just go into the software and create it from there over the console. You can write the command “getnewaddress” into the console to create one address. 

Because you can and should create many addresses, wallets provide you with a “seed phrase”. A seed phrase is an easy to remember phrase containing 12 to 24 real and simple words. 

This seed phrase acts as your only “private key” you have to remember. From this seed phrase, your wallet creates private keys. The private keys are created with the same one-way hashing principle as the other keys. 

This way you just need to remember one “password” to access all your addresses. It’s just one additional step in generating wallet addresses from a seed phrase which automatically generates multiple private keys. 

The advantage is that you need to secure only the seed phrase, having as many private keys as you want.


What Happens to the Previous Addresses Generated?

Addresses are permanent and you automatically use a new one per transaction

That means that you will accumulate some of them. 

We know that they aren’t deleted because they are permanent. The simple answer is that they just stay where they are. It is the same as you would create an account somewhere on a website or similar. Your account will just remain valid. 

If you don’t use it, it will just be unused, but if you want to re-use it, you can do it as well. Your old addresses aren’t erased or deleted so you don’t have to be afraid of losing them or that they will get deleted after a certain amount of time. 

One thing you should keep in mind is that you will need your private key to access your funds. If you lose it, you lose your access. Aside from the key, save your address somewhere in a secure place so you don’t accidentally lose or forget the number. 

In such a case, you would lose your access as well because you don’t know anymore where your funds are stored.

What Address Type Should You Use to Send and Receive Bitcoin Transactions?

There are different address types you can use. 

It doesn’t matter and you can use any type. 

Different types have their specific advantages you should consider like different amounts of fees used. 

But foremost, you should always use a correct address either for the receiving or the sending one. Each address is a string of alphanumeric characters and the different types are recognizable by their prefix of “1”, “3”, or “bc1”. 

The wallet you use could limit you because not every wallet supports any type of address. Another factor to keep in mind is that they are associated with the wallet you use. 

So it is as important to not only look at the address type but at which wallet you use because you won’t be able to associate another wallet to your BTC addresses. What you also should keep in mind is that your sending and receiving address differs. 

Your wallet creates new ones to receive crypto and if you want to send cryptocurrencies, you need to take some of your existing addresses. 

Every address has its own amount of funds and is not interchangeable, so always double check before you do any operation.

What Happens When You Send Funds (BTC) to an Invalid Address?

When you send your BTC funds to a wrong address, the Bitcoin network will reject this one transaction you make. 

This means that your funds will not move and there is no risk of losing them. 

Every operation has to be validated and to be accepted by the network. There are always calculated checksums to verify if the address used is correct. 

If it is incorrect, the operation gets rejected, and doesn’t move funds. Therefore, you are protected. Another case where you could lose your funds is if you send them to a valid address owned by no one or someone else than you intended. 

Here, the network verifies the transaction because the address is correct and processes the operation. Because Bitcoin is decentralized, there is no central authority you could ask to refund. In this scenario, your funds are sent and you lose them. 

To ensure you receive funds safely, always check everything you do related to your crypto. Just be as cautious as you would with other important things in your life.

Conclusion: Why Does a Bitcoin Address Change?

the frequent change of Bitcoin wallet addresses serves two primary purposes: security and privacy. By using multiple addresses, you minimize the risk of potential hacks and thefts.

It becomes harder for hackers to track and steal all your funds since they would need to discover all the addresses where your funds are distributed. Additionally, using different addresses enhances your privacy by making it more difficult for others to trace your transactions and link them to your identity.



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About the Author:
Morgan Davis, an expert in digital currency and economic analysis, offers a unique perspective on cryptocurrency within the global financial landscape. With a background in International Economics, Morgan's insights delve into how macroeconomic factors influence the crypto market. Their writing simplifies complex economic and cryptocurrency concepts, making them accessible to a broad audience. Morgan is actively engaged in discussions about the impact of blockchain on finance, and their work empowers readers to understand and navigate the world of digital currencies.