The amount of fiat you hold is a reflection of the trust you have in the government, while the amount of Bitcoin you own is a reflection of how much you distrust them.
The creation of Bitcoin and other cryptocurrencies have offered a newfound opportunity to transact beyond borders and economies with a global currency. The underlying blockchain technology enables the world to transact in an immutable and transparent manner. However, this novel form of technology has not addressed the privacy concerns which are equally important for the people. For instance, anyone who has access to someone’s wallet address would be able to view the wallet’s balance and transaction records on the blockchain, on the public ledger. As more people are investing or using cryptocurrencies for daily purchases, there is a growing need to resolve the security issue pertaining to anonymity in cryptocurrencies.
Fortunately, there are a suite of privacy-oriented products that were specifically designed to provide an additional layer of privacy protection for cryptocurrency users. For tech-savvy individuals, the combinative use of VPNs and anonymous browsers like TOR could remove any traces of your location and identity while using cryptocurrencies. Other appropriate means include using a good Bitcoin mixer, using privacy coins as a transaction proxy, and even privacy-focused cryptocurrency wallets. As the cryptocurrency market matures over the last decade, more solutions are created to better serve the needs of a growing group of users worldwide. Currently, we are entering a new decade where a fully anonymous Bitcoin wallet may finally be available for everyone.
Privacy for Cryptocurrency Wallets
In April 2018, a group of researchers published a 22-page research article on Monero (XMR) blockchain. Although Monero is currently one of the prominent privacy coins in the market (other prominent privacy coins include ZCash, Grin and Beam), the researchers were able to guess the wallet connected to Monero transactions with a whopping 80% accuracy rate. Similarly, in November 2019, an article published by Ivan Bogatyy of Dragonfly research has revealed that 96% could be unmasked from Grin transactions with a mere $60 spent on Amazon server space and negligible processing time, disproving the theory that MimbleWimble protocols are anonymous.
It is important to remember that the techniques deployed by these skilled researchers may not be easily replicated by regular users. However, the existence of such flaws even in cryptocurrencies that claimed to be ‘Privacy-oriented Coins’ pose a greater concern to users, since anyone could engage skilled individuals to snoop out the ownership of any wallet addresses. Fortunately, not all hope is lost in the battle against privacy rights in cryptocurrencies as privacy-focused wallets could act as a buffer between data infiltrators and users.
MyCryptoMixer’s Top 5 Privacy Wallets
A growing number of cryptocurrency users and enthusiasts are exploring new solutions to boost their anonymity, privacy and security since then, as they are growing wary of the involvement between blockchain analytics firms and regulators, in addition to the security threats posed by third-party attackers. Fortunately, cryptocurrency users could choose from a variety of options to enhance their privacy.
In this article, we will be sharing 5 of the most credible privacy-oriented crypto wallet solutions to store your digital asset safely and anonymously.
Desktop Wallet - Electrum
Securing Bitcoin payments since 2011, Electrum is a lightweight Multisig Bitcoin wallet which is available across most desktop operating systems and more recently as an android mobile app. Due to its software design, Electrum could work on the privacy-oriented Tails operating system as well. Running the wallet on Tails enables users to route the data traffic via TOR, ensuring transactions made within the wallet untraceable. Another point to note is the wallet’s ability to automatically generate new addresses for every transaction, thereby preventing the user from reusing the same address twice.
The cold wallet may be the oldest Bitcoin wallets known on this list, but it has gained a long track record and trust of the cryptocurrency community throughout its lifetime. Electrum is also regularly updated with the latest security patches and added compatibility with other popular hardware wallets such as Ledger and Trezor.
Hardware Wallet - Ledger Nano X
Ledger was launched in 2014 by experts with complementary backgrounds in embedded security, cryptocurrencies and entrepreneurship. It is by far the most secure hardware cryptocurrency wallet in the market today. The company has produced two variations of its privacy-centric wallet - namely Nano X and Nano S. Both of these products offer a remarkable suite of features which assure the user with the best-in-class privacy solution. Some notable features include NIST-certified True Random Number Generator for signature security, and ample storage space for over 100 unique cryptocurrency wallets, of which each of these wallets could generate millions of unique addresses.
In the event that the hardware wallet is stolen or lost, users could restore all funds with a 24-word mnemonic phrase on a new Nano device, removing the concern of theft.
Web-based Wallet - Rahakott
One of the newer wallets on this list, Rahakott is a multi-cryptocurrency web wallet with a built-in Bitcoin mixer feature, designed to protect users’ privacy and anonymity, while transacting in any of the supported cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH), Monero (XMR), ZCash (ZEC) and Dash (DASH). Owing to its active team of developers, more cryptocurrencies will be supported at a later time.
Rahakott is accessible via the anonymous TOR network, offering users an additional layer of privacy protection on top of its highly secure web wallet. This option will be suitable for users who are just starting out with cryptocurrencies and do not wish to commit to a hardware wallet or a more complex desktop-based wallet like Electrum wallet. One point to note, however, is that users are responsible for backing up their mnemonic seed phrase. Failing which will result in a permanent loss of access to the user’s account.
Android Wallet - Samourai
Available as an android wallet (iOS version slated for release at a later date), Samourai is one of the best privacy-focused mobile wallets for Bitcoin. With a staggering 3.5 billion smartphone users worldwide, the “Bitcoin wallet for the streets” lived up to its reputation as the mobile wallet that offers hassle-free cryptocurrency storage at the comfort of the user’s mobile phone, anywhere they go. Developers of the wallet are also known to stay true to Bitcoin’s foundational principles, ensuring the full anonymity of the wallet from regulators.
Samourai wallet is comparable with desktop wallets, packing with privacy-rich advanced features such as a Built-in IP address anonymization with TOR and VPN, different public wallet address for every new transactions, military graded AES-256 encryption and other innovative functions such as Ricochet send and Stonewall transaction protection.