Many wallets current a sending interface as a single recipient handle subject and a single quantity. The ensuing transaction usually has two outputs, although. One to pay the recipient and one to ship the rest of your funds again to your individual pockets as a change output. Nonetheless, transactions usually are not restricted to having one or two outputs. You may very well specify any variety of outputs (till your transaction hits the burden restrict).
Fee batching is very helpful for big enterprises like exchanges and on-line wallets. As an alternative of facilitating a whole bunch of single-payment transactions per day, they might create transactions at an everyday cadence to difficulty all excellent funds in a single transaction. One alternate I used to work with would for instance construct a single withdrawal transaction each quarter-hour, which then would pay 5–50 customers directly. One other firm, a highly regarded brokerage, even created a transaction each 30 seconds to facilitate some 10–30 funds.
The large benefit of batching funds is that they nonetheless solely want one change output. For those who pay 1000 customers per day with single-payment transactions, you ship again 1000 change outputs to your pockets that you’ll have to spend once more later. For those who ship 100 transactions that every batch 10 funds, you solely ship again 100 change outputs to your self. Moreover, you want to use at the least 1000 inputs to create 1000 transactions, however maybe most of your batching transactions might be funded with 1–4 inputs. Sometimes, you’ll even be capable of discover just a few inputs that match the recipient quantities precisely and you will have no change output in any respect. Total, batching funds can considerably scale back the price of working a big quantity pockets, and simplify UTXO administration.