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1055 sats \ 4 replies \ @kepford 16 Jul \ on: UTXO consolidation strategies? bitcoin_beginners
I don't have an answer other than it depends.
I don't recall where but it seems like @DarthCoin had some opinions with more rational than "Wicked" provided on Twitter. I don't like advice without explanation.
I believe Darth's advice was UTOXs of different sizes with a minimum of 100k.
Consolidating UTXOs has privacy consequences so that should always be considered. But also in high fee environments small UTXO's could be unspendable. But also a huge UTXO used to make many transactions in the future will be bright on the blockchain.
The sizes has been my question for a while. If most bitcoiners believe the purchasing of bitcoin will continue to increase over time (as it has up to this point). Then why 1 million as the minimum?
I would guess the main reason is that this is a good minimum for a lightning channel. But other than that I don't see why 100k sats isn't big enough. That said, I would think it would depend on your spending habits and privacy concerns.
When you think about high fee environment future Lightning or another L2 is gonna be where you do your spending so the 100k vs 1m sat decision may not be the most important.
As I pointed in this guide - think lie a bank, not only consolidating by 100k/UTXO but also on different levels and with different wallets. It doesn't make sense to have all your stash in just one wallet and from there operate everywhere.
Another guide that should be taken in consideration for those that are starting now stacking is this one:
https://darth-coin.github.io/beginner/getting-started-stack-sats-en.html
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2 excellent charts
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Great response. The privacy implications are something to consider as well beyond what might not be viable in a future high environment.
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