GlossaryAdvanced
Change Address
A new address a wallet automatically sends unspent leftover value to, when a UTXO-based transaction doesn't use an entire input's full value.
A change address is a new address a wallet automatically generates and sends leftover value to, when a transaction on a UTXO-based network (see Kaavon's "UTXO" glossary definition) spends an entire input that's larger than the amount actually intended to be sent — the "change" is returned to the sender's own wallet via this new address.
Because UTXOs must be spent in their entirety, change addresses are a structural necessity of the UTXO model, unlike an account-based network (such as Ethereum), where a balance can simply be partially debited without needing an equivalent mechanism.
Examples
- Spending a 1 BTC UTXO to send 0.3 BTC generally creates a change output returning the remaining 0.7 BTC (minus fees) to a new change address.
- Change addresses are a structural necessity specific to the UTXO model, with no direct equivalent needed on an account-based network like Ethereum.