Daedalus wallet 0.12.0, installation overview + mystery of extra address being generated

Hi all,

Maybe this could be useful to some new folks (like me)… I installed Daedalus wallet last week but just saw today that an extra address has been generated and set as a main one. Obviously I would like to know if this is done on purpose? If yes, what’s the reason? It seems weird that your wallet is generating random address for fun. Maybe it will start sending ADA to random addresses too. Joking aside, here is a short overview.

I had a previous version of this wallet that has been upgraded to 0.12.0 last month. During the sync time I could not send ADA but I could receive ADA while it still was syncing. The new transactions showed immediately while the old ones were still being synced. Today I sent additional ADAs to my address and while checking if everything was OK I saw that I now have 2 addresses (the old/main one that I generated initially) and the new one that’s been generated by XXX for reason YYY. This new address is shown as the default one + its QR code and in the “receive tab” in the generated address part I have the new one come first and the old one at the bottom. Obviously I can still receive ADAs on the address that I generated first but why this second address?

Anyone? I checked https://iohk.zendesk.com/hc/en-us/articles/360013915513-Cardano-1-4-Daedalus-0-12-0-with-Cardano-SL-2-0-0-Release-Notes but could not find anything obvious also not on this forum.

Yes it is.

Privacy. If you keep using the same address people can work out who you are.
The coins on all your addresses are added together and appear as your total balance.
You can continue using an older generated address forever if you wish - so for example, if you gave out an address for people to send you funds on, that is fine, they can keep using it.

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This is called UTxO. Unspent Transaction Output. If you are coming from Ethereum it’s a bit confusing. UTxO was/is confusing to me. Bitcoin uses the same method. As an end-user I prefer the account balance approach provided by Ethereum.

This video does a decent job of explaining UTxO: