You are being watched. Private and government organisations are monitoring and recording your online activities, even your Bitcoin transactions are not spared from the surveillance.
When Bitcoin (BTC) was first introduced to the world in 2009, the concept of cryptocurrency was thought to be that of anonymous digital monies. Back then, darknet markets such as Silk Road, a marketplace for users to trade illegal goods and services, had adopted BTC as the primary mode of payment. However, it was not long before experts made known to the public that while Bitcoin revolutionised the idea of money to be transparent and immutable from any third party organisations and government bodies, Bitcoin transactions were pseudonymous (not anonymous). Because of that, Silk Road’s operations were short-lived as it was shut down by the Federal Bureau of Investigation (FBI) in 2013, two years after it was founded. The FBI authority later revealed that their investigative efforts have been greatly aided by blockchain explorers, which are free-to-use platforms to view the crypto transaction ledger simply by inputting the respective Bitcoin (or supported cryptocurrency) wallet address required for the search.
Is Privacy really important to me?
One man's ceiling is another man's floor. Originally created as a digital currency for the people to have complete control over their finances without intermediary, the open and public Bitcoin’s transaction ledger has also exposed a flaw about the possibility of regulators to trace each wallet address to specific people or entities. Governments from all over the world have also increasingly imposed stricter regulations on the use of Bitcoin and other cryptocurrencies. With the launch of various blockchain analysis firms such as Chainalysis and Cipher Trace, cryptocurrencies such as Bitcoin are not anonymous as they were once initially thought. Fortunately the cryptocurrency community is well aware of the growing concerns of Bitcoin and crypto investors, and have come up with various privacy tools to counteract the ongoing problem about privacy and anonymity.
Although some people may not feel that be of an issue, since they do not make use of Bitcoin and other cryptocurrencies for illicit purposes. However, such public exposure of your Bitcoin address’s transaction could pose a huge risk not just to your privacy, but also your security. For instance, mapping a Bitcoin address to its holder can be as simple as making a transaction. Both buyer and seller dealing with Bitcoin can reveal their entire transaction history to each other, since Bitcoin addresses from both parties will be revealed in the dealing process. In technical terms, this is called linkability, where reconstructing a particular chain of transactions is simple and easily accessible by either parties, or anyone who got hold of either Bitcoin addresses. While the process of linking transactions to the user is not a quick and trivial task, blockchain analysis firms have proven the industry that it is practically possible through a blockchain explorer.
Privacy is a right for everyone
Contrary to popular belief, privacy is not exclusively associated with criminal activity. In fact, a recent report by a blockchain analysis firm has highlighted that only 8.1% sent to Bitcoin mixers were derived from illicit use. A similar percentage can be seen in privacy coins (such as Monero and ZCash). Therefore, it is safe to say that a person’s ability to transact with others is a fundamental right, and everyone has the right to transact securely without exposing personal information to governments, organisations or bad actors who might use exposed data for ill intentions. In fact, people with bad intent will use whichever means they get their hands on to do illegal things. Unsurprisingly, that mostly involves FIAT currencies such as the US dollar.
Over the past decade since the ‘birth’ of Bitcoin, there are now numerous methods to achieve privacy and possibly complete anonymity with easy-to-use applications and services for the privacy advocates, agorists and anyone who values their privacy dealing with Bitcoin and other cryptocurrencies today.
Store your Bitcoins anonymously
Do you know that there are ways to obfuscate your pseudonymous Bitcoin transaction without having to worry about your Bitcoin transactions exposing your spending pattern? Samourai Wallet is a Bitcoin that is known to deter blockchain-based surveillance and censorship. Most privacy-based tools do not require you to create an account for their services, minimising the risk of data leaks from these providers. Samourai is one of those Bitcoin wallets that is custodial-free and requires no email address or KYC. They also have built-in TOR and VPN support to offer maximum privacy and IP address anonymisation. Another interesting point about this military-graded AES-256 encrypted privacy Bitcoin wallet is that for every transaction made using Samourai, a unique public wallet address will be automatically generated.
Other good wallet alternatives to prevent the risk of personal information theft include Electrum, Rahakott, and iOS Bread wallet.
Surf the Web without Compromising on Your Privacy
A growing number of web browsers like Opera and Firefox have shown keen interest in Bitcoin and cryptocurrencies. They have now included built-in Bitcoin wallets and Metamask integration. But these mainstream web browsers currently lack privacy and anonymity features required of privacy-conscious individuals. Fortunately, we have Brave browser to provide us with a private, secure and fast internet browsing experience. The browser is built on top of the open-sourced Chrome browser, but has gained huge traction among Bitcoin and cryptocurrency users due to its focus on users’ privacy. Additionally, Brave browser has an attractive ad monetisation option for cryptocurrency users, where they could reward websites with their native cryptocurrency called Basic Attention Token (or BAT in short).
For advanced users who are very particular about anonymity, utilising TOR browser could not only achieve your goal, but also allows you to surf .onion addresses. TOR Browser has been around in the web browser space for many years, and they are undoubtedly the most popular anonymous-based browser to protect users from tracking and surveillance. They achieve such features by directing traffic through an overlay network to hide its users’ locations and data usage.
Bitcoin Mixing Services for a Peace of Mind
MyCryptoMixer is arguably the most customer-centric Bitcoin mixer on this top five list, as evidently shown in their suite of supports given to users. Just like the rest of the mixers on this recommended list, no signups are required to utilise their mixing services. They do offer both TOR and clear web services, giving everyone an option to access their mixer. Currently, they accept Bitcoin for their mixing services. But the dedicated team over at MyCryptoMixer are also supporting Ethers, which will be announced at a later date. The service fee ranges from 0.5% to 5% (and 0.00025 BTC per recipient address), making them one of the most affordable mixers on the list. One interesting point to note about contributing service fees to the mixer is that irregular service fee contributions will make it harder to correlate to the BTC coins that you receive at the end of the process. MyCryptoMixer also allows a slightly higher number of recipient Bitcoin addresses, making it potentially harder for blockchain analysis service to track the mixed coins. Alternative bitcoin mixers include BitBlender, BMC mixer and Blender.io.
Confuse others with simulated IP addresses to hide your actual location
Lastly, privacy-oriented individuals should consider subscribing to Virtual Private Networks (VPNs) as they serve to provide anonymity through routing your data traffic to a random location. For instance bad actors may attempt to track your IP location as Seoul, South Korea when you are physically in London, United Kingdom at that moment, surfing the net. Quality VPNs such as NordVPN provide users with a secure and encrypted internet surfing experience, and do not store any logs which could compromise your browsing activity. NordVPN stores no logs and can even block annoying ads for you. Other favorable VPNs that have been used by the cryptocurrency community include ExpressVPN and CyberGhost.
The Age of Privacy
We can learn a lot from the crypto-anarchists and privacy-conscious individuals in the day and age of big data and surveillance capitalism. The above-mentioned online resources are not only for privacy advocates or criminals but for anyone who does not want their personal information to be exposed without their permission. Mix-matching the usage of these crypto privacy tools could ensure your complete anonymity while safely dealing with Bitcoin and other cryptocurrencies.