That keeps things separated so that you get a maximum degree of anonymity or
privacy.
And you don't need, as an individual,
to worry about the management of all these different keys and addresses.
Your wallet software takes care of it for you, and just gives you a very simple
interface that says how much is in the wallet, and lets you spend it.
The wallet software figures out all the details of which keys need to be used, and
how to generate new addresses and all of that stuff.
So one thing you need to do if you are going to be able to
receive Bitcoins in payment into your wallet or spend them to somebody else,
is you need to have a way of exchanging an address with somebody.
So you can give them an address or receive an address so that payments can happen.
And there are two main ways that addresses are encoded or conveyed in this way,
the first one is as a text string.
And the second is as a QR code.
So as a text string what we do is we take the bits of the key and
we encode it as a number in base 58 notation.
And then we use these 58 characters to encode the digits in our base 58 notation.
So what this is basically is it's all of the digits in capital letters and
small letters, except that they've taken out a few that might be confusing or
might look like each other.
For example, capital O and
zero are both taken out because they look too much alike.
But other than that most of the characters are here and
you can encode in first in base58 notation and then using this alphabet.
The second method for encoding a Bitcoin address is as a QR code.
Something like this, this is a simple 2D bar code.
And you can do something like point your phone at this, take a picture.
And your phone can scan it and recover the bits of the address.
And so this is the sort of thing you might use for example in a store.
Or if you want to have a phone to phone communication.
My phone might display a bar code like this which is my address on it and
your phone might take a picture of it in order to get the address.
So this down here actually is an active address and
if you'd like to give me some Bitcoins, feel free to do so.