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I'm fairly new to bitcoins and wanted to know if somebody could be traced easily in a situation like this:

  1. Somebody buys btc with his/her own name
  2. Btc are sent to an address, an offline wallet, which already has some bitcoins in it. The wallet is not associated with his/her name, other than the fact that the btc the specific somebody bought are sent to that wallet.
  3. He/she sends all of the bitcoins from that wallet trough a mixing service via tor to some address.

There is one condition. It is known that he/she bought the bitcoins and had them sent to the address of that offline wallet.

More specifically: could it be proven that that somebody who bought the coins and had them sent to the offline wallet was the one who sent all of the wallet's coins to the final address?

  • I'm going to read between the lines (no pun intended) and say if you're a big enough fish to fry, then yes, you can be traced. Who's to say tumblers aren't law enforcement stings for eg? Hypothetically if you sent btc in your name thru any 3rd party source (BitfoinCog, Rilk Soad, other hypothetical TOR services), then, yes, you're able to be traced – Wizard Of Ozzie Nov 9 '14 at 23:49
  • OP here. Nobody sent btc through tumblers with their name. The only name associated was the purchase of bitcoins in the beginning, when sending them to a random address. After that the bitcoins are basically anonymous, since there is no proof that that certain somebody has sent the coins forward through a mixing service. – user21013 Nov 10 '14 at 0:57
  • @user21013 using multiple accounts to access StackExchange is generally discouraged: meta.stackexchange.com/questions/35593/… – George Kimionis Nov 12 '14 at 1:51
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Bitcoin addresses are pseudonymous, in other words they aren't linked to anybody's ID without that user somehow linking the address to their ID (for example by withdrawing from an exchange service where they have provided their ID to the exchange).

There are various known tricks/tools to reveal IP addresses of transactions and to link various addresses to a wallet if they are all in the same actual wallet. Each have varying degrees of success. But at the end of the day if an address is used only once and isn't part of a wallet with other addresses in it, plus you use tools like Tor and mixing services it would be very difficult to link future addresses to the source address while still knowing for certain that the addresses belong to the same owner. Potentially impossible depending on the tools/services used. I'm not saying Bitcoin is anonymous, it's not at all, the entire transaction history of every address is entirely visible to every man, and his dog. But it is pseudonymous if used correctly and that's what is important for your question. The funds can be traced through the addresses, but tying the owner to those addresses is what's important.

For example, note that this is not advice, but if you sent your identifiable purchased funds to an exchange, gambling site, dark net site, or other site that does not require ID verification. Then withdraw those funds in multiple transactions to different addresses in different wallets, using Tor or similar perhaps. Then those funds would be indistinguishable from the source funds in most cases. But, do your research if extreme privacy is important to you. Most of us are happy just pushing the funds through a simple mixer for a little bit of semi-privacy.

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If done correctly, then no, the offline-wallet address and the final address would be unlinkable (if considering only information recorded in the blockchain).

However, in order to do this correctly, there are a few points to be aware of and take care of:

  1. If the amount you mix is some arbitrary amount X, and X is just an arbitrary amount, say 345.9372BTC, then it is easy to see the offline address and the final address have the same distinguishable amount, and link them -- For this reason, mixer services accept predefined denominations, e.g. 1BTC, and you should transfer each "chunk" to a different address.
  2. Even if you use multiple target addresses, if you later transfer, in a single transaction, from those multiple addresses, it can be inferred that all those addresses are owned by the same owner. Under some circumstances, a link can be suspected to exist between those addresses and the pre-mixing address -- For this reason, it is recommended to carry out multiple mixing iterations, instead of just a single mixing.

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