23 January 2016

Sourcing Bitcoin

Let's go back a few weeks to Receiving Bitcoins, where
I located a couple of working faucets, opened their pages on my second laptop, gave both the same wallet address, and spent a few days entering captchas.

While I was doing that, and before I was done, I noted that someone had sent me some bitcoin.

'You just received 0.00048 BTC (worth €0.18 EUR) from an external bitcoin account.' [...] I had no idea where that money came from.

Is there any way to determine the source? The message linked to my Coinbase wallet, which linked to Blockr.io under Advanced Details. What is Blockr.io?

In another previous post, 'Bitcoin Buy Online Books' (November 2015), I procured the book 'Mastering Bitcoin' by Andreas Antonopoulos (O’Reilly Media, 2014). This turns out to be a good resource for understanding the mechanics of bitcoin transactions. Chapter 2, 'How Bitcoin Works; Transactions, Blocks, Mining, and the Blockchain' (p.15) calls Blockr.io a 'blockchain explorer':-

Popular blockchain explorers include:
* blockchain.info
* blockexplorer.com
* insight.bitpay.com
* blockr.io
Each of these has a search function that can take an address, transaction hash or block number and find the equivalent data on the bitcoin network and blockchain.

The Blockr.io page includes a list of transactions, where I spotted the address I had given to the faucets. This led to another page,

btc.blockr.io/address/info/1BU6zAqUFdR2gsNNx2czro4zGD7jcznLCV

which reported *three* transactions against the address. What was the third? Two faucet transactions plus a mystery transaction gives three transactions, but as I mentioned in 'Receiving Bitcoins',

I never received anything from the second faucet, the one requiring the minimum, which had told me 'Expect your payment in next 24 hours'.

The third amount was about 6% smaller than the final amount I had noted for that second faucet, but it was the right ballpark. I suppose it was so small that Coinbase didn't think it was worth sending me an email about it.

On none of the three transactions was there any hint of the source. How do you do proper accounting using bitcoin?

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