Dust

How It Works

The Bitcoin protocol defines a dust limit — the minimum UTXO value below which nodes will not relay the transaction by default. This limit exists because every UTXO must be tracked by full nodes, and creating UTXOs that are uneconomical to spend bloats the UTXO set permanently. The exact threshold depends on the fee rate and output type, but generally any output below 546 satoshis (for P2PKH) is considered dust.

Even above the protocol dust limit, many UTXOs are practically uneconomical. If a UTXO holds 1,000 sats but spending it requires 500 bytes of transaction data at a fee rate of 10 sat/vbyte, the fee to spend it would consume half its value. During high-fee environments, UTXOs worth tens of thousands of sats can become temporarily uneconomical to spend. This is why UTXO management during low-fee periods is important — consolidate small UTXOs when fees are cheap.

Dust attacks are a specific privacy threat where an attacker sends tiny amounts of bitcoin to many addresses. The goal is not the bitcoin itself — it is surveillance. When you later spend the dust alongside your other UTXOs, the attacker can link those UTXOs as belonging to the same wallet. The defense is simple: use coin control, label unknown incoming dust, and never consolidate it with your main holdings. Freeze suspicious dust UTXOs in your wallet.

Key Points

• UTXOs too small to economically spend given current transaction fee rates
• Protocol dust limits prevent the smallest outputs from being relayed
• Dust attacks send tiny amounts to track your spending via UTXO linking
• Consolidate small UTXOs during low-fee periods to avoid future problems
• Use coin control to freeze and isolate suspicious dust from unknown senders