Anonymity of Bitcoin Transactions: How to Keep Your Operations in Secret?

Initially, cryptocurrency transactions are not anonymous despite the fact that this type of digital money is decentralized. Staying anonymous in your bitcoin transactions might be tricky, since you often leave some digital footprints behind you.

All transactions are recorded in a blockchain (public register). In fact, they are not actually linked to user’s identity. Your name, address or email cannot be seen in the recorded information, but your personality can be tracked by IP or even a private wifi connection. Well, even if you do not use cryptocurrency for some illegal aim, you may be willing to have your operations secure.

Bitcoin transactions are not considered as anonymous by default. But don’t worry, there are some methods to keep your identity in secret. Here are some tricks you should try.

The best tricks to make your bitcoin usage anonymous

·        Tor/Onion router

Anonymous browser
Anonymous browser

Tor is a community that works to ensure anonymity in users’ online activity. You can take advantage from their browser and connect to bitcoin network with its help. This way you will make your transactions safe and encrypted.

Tor works as a system that connects a large amount of computers from all over the globe. The principle of its work is simple – it takes the internet traffic from one computer and routes it to another one. Therefore, the real traffic’s way is impossible to pinpoint. It encrypts your IP address from which you make a transaction and helps you keep your activity in secret. However, there are some bitcoin platforms that make Tor useless (CoinBase, for instance). So make sure that you stick to those that support Tor or a VPN (like BitSquare or LocalBitcoins).

Tor can be used on most devices however if you have Windows on your computer, then you can connect to the network using the standard 9050 Tor port.

·        Mixing

All bitcoin transactions are recorded in a public blockchain and every member of this network can learn the origin and destinations of your money. To hide your identity, you can try bitcoin mixer.

Bitcoin mixer allows breaking this traceability. It swaps coins between addresses of the same amount or creates temporary addresses, hiding the trail of your transaction.

Here are some websites that provide bitcoin mixing:

Mind, that this services are not free.

·        Logless VPN

No-log VPN
No-log VPN

VPN (virtual private network) is a network that keeps the history of your operations anonymous. This service encrypts your traffic and routes it between other servers before it reaches the final destination. Therefore, it becomes difficult to identify your identity. If you connect a logless VPN to your bitcoin wallet, you will reach privacy in your operations. Here are some websites that provide logless VPN services:

·        Face-to-face cash transactions

Face-to-face bitcoin transactions may be another anonymous way to deal with your digital currency anonymously. There are services like LocalBitcoins that provide such option.

Here are some instructions:

  • User Tor or VPN when accessing LocalBitcoins or other similar site
  • For registration, make sure to use a fake name and email generator
  • Check seller’s/buyer’s feedback and reputation rate
  • Use public phone to contact seller/buyer
  • Choose public place for meeting
  • Make sure not to use anything that may give out your identity, even your car

These steps will help you get your cash as safely as possible.

·        New address

Most bitcoin wallets allow generating a receiving address every time you make a transaction. Also, every time you get bitcoins from others, you may use a new address, too. This change confuses newcomers sometimes: they wonder why their address is changing all the time. However, knowing how to deal with this function, you may create as many addresses as you want and therefore make your transactions encrypted.

As you already know, blockchain is 100% transparent and anyone who knows your address may check your spending habits and your balance. If you want to ensure anonymity, do not reuse the same name.

Being a relatively fresh technology, bitcoin still has a long way to go. Its rivals – dash and monero – are designed to be anonymous at the protocol level and we hope this will motivate bitcoin to make anonymity a common practice for the transactions inside its network.

For today, bitcoin cannot provide users with anonymity. However, as you see, there are ways to use bitcoin safely and anonymously. The solutions listed above will help you keep your transactions in secret. Use these methods to make your operations absolutely safe.

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