A Bitcoin address, also known as just address, is an identifier of 27-34 alphanumeric characters, beginning with the number 1 or 3, which represents a possible destination for a Bitcoin payment.
Addresses can be generated for free by any user of Bitcoin. For example, using MultiBit, one can create a new address and be assigned an address. It is also possible to get a Bitcoin address using an account at an exchange or online wallet service.
An example of a Bitcoin address is 31zAbMgunupLhBBTewXjtqbBr5MndwfXhb.
Bitcoin address assigning
One can transfer bitcoins to a person by sending bitcoins to one of their addresses. A person can have many different Bitcoin addresses.
It is recommended that you use a unique address for each transaction, for increased privacy. Most Bitcoin software and websites will help with this by generating a brand new address each time you perform a transaction. Some services provide a facility to request a new Bitcoin address for use with their service when desired.
When using a web site that accepts bitcoins or holds Bitcoin balances on your behalf, that website will assign a Bitcoin address to your account, so you can transfer funds into your account at the site. A bitcoin address may change every time funds come in so care should be taken when sending additional funds to a previously-used address. When you send Bitcoins to your account at a web site, they will usually be credited to your account at that web site after the transaction is confirmed.
Offline Bitcoin address creation
Bitcoin addresses can be created without an Internet connection and does not require any contact or registration with the Bitcoin network. The network starts tracking an address when it is first seen in a valid payment transaction.
It is possible to create large batches of addresses offline using freely available software tools. Generating batches of addresses is useful in several scenarios, such as e-commerce websites where a unique pre-generated address is dispensed to each customer who chooses a “pay with Bitcoin” option.
An average computer can generate thousands of new Bitcoin addresses a minute. Addresses are created simply by generating random numbers and then performing mathematical operations to derive matching pairs of “public” and “private” keys. Because addresses can be created easily and at minimal cost, it is not uncommon to create temporary addresses that can be discarded if unused.
Case sensitive and exact
Bitcoin addresses are case-sensitive. Bitcoin addresses should not be manualy writed, it is recommended that you use your computer’s clipboard.
If even one of the characters are not writen exactly as provided, including capitalization,it will be rejected by the Bitcoin software.
The probability that a mistyped address is accepted as being valid is 1 in 232, that is, approximately 1 in 4.29 billion.
In most Bitcoin addresses, there is at least one secret number known as a private key which is required for access to the funds assigned to that address.
When using a Bitcoin client, private keys are typically stored in the wallet file. The private key has a special purpose, it is mathematically needed to create valid transactions that spend the funds originally sent to the address. If the private key to an address is lost , any associated Bitcoins are effectively lost forever.
Addresses can be created in a way that require a combination of multiple private keys. Since these take advantage of newer features, they begin with the newer prefix of 3 instead of the older 1. These can be thought of as the equivalent of writing a check to two parties – “pay to the order of somebody AND somebody else” – where both parties must endorse the check in order to receive the funds.
The actual requirement, that must be satisfied to spend the funds is decided in advance by the person generating this type of address, and once an address is created, the requirement cannot be changed without generating a new address.
What does a bitcoin address made of
Most Bitcoin addresses are 34 characters. They consist of random digits and uppercase and lowercase letters, with the exception that the uppercase letter “O”, uppercase letter “I”, lowercase letter “l”, and the number “0″ are never used to prevent visual ambiguity.
Some Bitcoin addresses can be shorter than 34 characters (as few as 27 in theory) and still be valid. A significant percentage of Bitcoin addresses are only 33 characters, and some addresses may be even shorter. Every Bitcoin address stands for a number, just like an account number. These shorter addresses are valid simply because they stand for numbers that happen to start with zeroes, and when the zeroes are omitted, the encoded address gets shorter.
Several of the characters inside a Bitcoin address are used as a checksum so that typographical errors can be automatically found and rejected. The checksum also allows Bitcoin software to confirm that a 33-character (or shorter) address is in fact valid and isn’t simply an address with a missing character.