0 sats \ 2 replies \ @kytt 18 Dec 2023 \ on: Is consolidation UTXOS a good practice? bitcoin
Spending a small UTXO in a high fee environment could negate its worth. However, if you don't necessarily need a UTXO in a rush, you could purposely set the fee low on the expectation that it will get confirmed eventually, but who knows how long that would take.
I'm basically entirely KYC'd so I'll consolidate most of mine together at some point, maybe soon, but I have a feeling it's going to get lost in a boating accident.
As far as I know, if you consolidate all of your small utxos into one. As soon as you make a payment, the receiver of this txt will know how much BTC you have left.
In the other hand, if you have different sizes utxos you can pick the right one in order to make the payment trying to avoid to get some change back....
So, IMO consolidation is not good for privacy.
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Of course consolidation is bad for privacy, since it reveals links to different histories that a receiver wouldn't have known about otherwise. When the fee environment allows for you to do so, based on your personal preference, I'd put bitcoin into Whirlpool's various pools so that when I spend from them, they have forward-facing anonymity. Meaning, their history is not linked to me spending them. Utilizing the different size pools allows you to spend from the smallest available single output so that you're not also doing a consolidation on spend.
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