Address Clustering
Definition
A technique that groups blockchain addresses likely controlled by the same entity. The most common method uses the common-input-ownership heuristic: all input addresses in the same transaction are assumed to belong to the same wallet. Commercial analytics platforms apply this at scale across entire blockchains.
- Domain
- Blockchain analysis
- Core heuristic
- Common-input-ownership
- Assumption
- Same-transaction input addresses share an owner
- Application scale
- Entire blockchains via commercial platforms
- Use case
- Cryptocurrency tracing
Common questions
Why does the common-input-ownership heuristic work as an identification technique?+
Spending from multiple addresses in a single transaction generally requires the private keys for all of them, so a wallet combining several addresses to make a payment reveals that those addresses are controlled by the same entity.
Is address clustering always reliable for tracing a suspect's holdings?+
No, techniques such as coin mixing services and deliberate use of separate wallets per transaction are designed to defeat the common-input heuristic, so clustering results still need corroboration from other evidence before being treated as conclusive.
Related terms
- Blockchain Explorer
- A web interface or API that indexes a blockchain and allows queries by address, transaction hash, or block. Examples: Blockstream.info for Bitcoin,...
- KYC (Know Your Customer)
- The identity verification process that regulated exchanges and virtual asset service providers (VASPs) are legally required to perform before allowing users to...
- Mixer / Tumbler
- A service that pools cryptocurrency from multiple users, exchanges it, and returns equivalent amounts to different addresses, intentionally breaking the transaction graph....
- UTXO (Unspent Transaction Output)
- An unspent transaction output is a value-bearing output available to a future transaction satisfying its script conditions. Spending consumes the selected output...
- VASP (Virtual Asset Service Provider)
- The Financial Action Task Force (FATF) term for businesses that exchange, transfer, or custody cryptocurrency on behalf of customers. VASPs are subject...