Why are there so many recipients when I send money from one exchange to another? So I sent BTC from my Bybit wallet to Coinbase wallet.
The transaction was successful and I was looking at the blockchain explorer and it had one sender address with an amount different to what I sent and it had so many other recipient addresses listing different amounts. I saw my transaction amongst the various transactions listed in the hash.
Why am I seeing so many transactions with different amounts and is the senders address my address or Bybit?
I am new to BTC and a total noob, please help me make sense of this.
Thank you!
When you bought bitcoins on Bybit, Bybit added the corresponding Bitcoin balance to your account. Your request to withdraw your funds to your Coinbase wallet caused Bybit, in the role of the custodian of your funds, to issue a payment that sent the funds to your wallet (and reduce your balance with Bybit accordingly).
Bitcoin transactions may perform multiple payments at once by assigning funds to multiple recipients in separate transaction outputs.
Presumably, Bybit is a large enough service that many other users requested withdrawals around the same time, and this allowed Bybit to batch together all those payments in a single transaction. As every transaction needs at least one transaction input, a transaction header, and usually a change output to assign the remaining funds back to the sender, payment batching is more blockspace efficient and allows the service to reduce their cost per withdrawal.