I was going through some old posts regarding address reuse and came across a few remarks I wasn't aware of, and want to make sure I understood correctly.
I knew address reuse wasn't the best for privacy reasons, but I learned today that apparently it's also not good for security IF you've spend your bitcoins.
Let's consider the following situation: I have a brand new hardware wallet, generated a new seed with it, alongside a new address. I send from an exchange 1 BTC to it, and I decide to use this address as cold storage, meaning I'll regularly send BTC from exchanges to it, this specific address.
First of all, is it considered as address reuse if the address is only for cold storage, there's no transaction out but only UTXO's?
Now, let's say after a year of doing so this address has 50 UTXO's. I know this might cause an issue if the mempool gets full and tx fees rise, so I decide during a calm period to do some UTXO management and I do a "send all" to a new address that I generated from the same seed (so same private key). I effectively have a brand new address with only one UTXO.
My question: since i've used the same private key to both send a transaction (a big one, 50 utxo's) and generate a new address to send that to, does that expose me to security risks? (referring to this). If yes, how bad is it really and does that mean that to achieve full security I would need to generate a brand new seed on my hardware wallet and send once again the full balance to a new address?