Hot answers tagged

51

The short answer is no. The long answer is split into three parts, each headed by a bold word. I will talk about the existing privacy tools in Bitcoin. I will talk about some pie-in-the-sky theoretical crypto which would achieve full anonymity (but which can't be done feasibly today). I will talk about CryptoNote, its limitations, and feasible ways around ...


41

No, IP addresses are not stored in the blockchain. But Gavin Andreson indeed notes that Unless you are very careful in the way you use Bitcoin (and you have the technical know-how to use it with other anonymizing technologies like Tor or i2p), you should assume that a persistent, motivated attacker will be able to associate your IP address with ...


40

Technically the appropriate term is "pseudonymous" - imagine that your bitcoin address is like an email address or an online alias: how hard it is to trace to your actions depend largely on what you do with it. There is, for example, a bitcoin address in my forum signature that would obviously be VERY traceable back to me. On the other hand if I install the ...


40

As I understand it, the "stealth address" is intended to address a very specific problem. If you wish to solicit payments from the public, say by posting a donation address on your website, then everyone can see on the block chain that all those payments went to you, and perhaps try to track how you spend them. With a stealth address, you ask payers to ...


31

Don't publicly disclose any address in your wallet, or associate any address with your true identity. Use currency exchanges to break the 'money trail' of bitcoin addresses associated with you.* Use anonymizing services such as TOR when conducting business. Break up your transactions between online and offline (person to person) transactions. Buy bitcoins ...


24

Say I received 10 bitcoins on a Bitcoin address I publicly advertise for donations. Anyone looking at the blockchain can put that address in a search engine and find me. Now say I want to use those 10 bitcoins to buy drugs. If the drug dealer's bitcoins are traced, they'll point right back to me. Now I can create a lot of accounts if I want. And I can pass ...


19

Short answer: yes, it will be anonymous Long answer: The following applies to all Cryptonote based coins, unless stated otherwise: On the blockchain, all addresses are one time addresses. In Bitcoin, you are exhorted to not reuse addresses, but Monero enforces this. Every new transaction causes a new one time address to be generated, in such a way that ...


17

The blockchain doesn't store IP addresses. In order to obtain the IP address of someone sending or receiving bitcoins, you would have either observe the activity of the network very carefully, or track them down by some other means. Keep in mind that, for example, someone could receive bitcoins without ever being connected to the internet.


17

If your business partner knows your address, they can learn the transaction history and balance of that address. Often it is possible to guess or deduce that other addresses also belong to you, but this requires a bit more effort and is less reliable. However, this certainly doesn't translate to your complete wallet's balance and activity to be known. This ...


15

If I'm sending someone my wallet-address, am I making my account balance visible to him? Yes. all transactions are public, means if I know the wallet address, I can reconstruct the current account balance Yes. All transactions of that address are in the blockchain, so they're public. Owners of bitcoin addresses are not explicitly identified, but all ...


14

Use Tor whenever connecting to the Bitcoin network or to exchange sites. Never publish one of your Bitcoin address publically (e.g. in a signature or blog). If you do, and someone actually sends money to this address, you run the risk of them being able to identify your other addresses and monitoring every transaction your make via Block Explorer. Any ...


13

You can trace the coin back to its origin, the question is whether that information is meaningful. Say I steal 50 bitcoin. I can pass them around between several different Bitcoin accounts, all mine, and you can trace them. The problem is, you don't know whether any of those transactions are real. Say Jack has 50 bitcoins that come from a block reward and ...


12

That is accurate. Let me start explaining how Bitcoins work from the beginning: Bitcoins are first created when they are mined by solving a block. The first transaction in the block is basically you saying "I'm giving myself 50 Bitcoins to my address A" (plus transaction fees from the block). When you want to spend Bitcoins, you have to point to one or more ...


12

It is possible to trace Bitcoins all the way back to the blocks they were mined, although it might be a hard task. Similarly, one can also trace them back to any withdrawal from MtGox, as long as we know which transaction to look for. No matter how many times you send them from one address to another, it is still possible to trace them back to that ...


11

Alice wants to transfer 1 BTC from address A to address B Bob wants to transfer 1 BTC from address C to address D CoinJoin gives them a way to combine their transfers into a single transaction that has two inputs (A and C) and two outputs (B and D). Someone observing the blockchain no longer knows which one of the outputs is Alice's and which one is Bob's. ...


11

First of, I am a Monero core developer. I'll try to remain as factual and objective as possible, though. Now, for the simple answer: use Monero And for the longer answer: read Andrew Poelstra's very informative reply. I would also add the following: Zero-Knowledge Proof has several of fundamental issues that may not even be fixable (from the less ...


11

When Bitcoin was invented, Blockchain analysis was not as advanced as it was today and pseudonymous transactions were believed to be closer to anonymous than they are with Bitcoin today. Under the current Bitcoin system, privacy can be greatly improved by avoiding fiat entry/exit ramps connected to your identity and by avoiding reusing BTC addresses. Yes ...


10

There is a patch that can be used to let you specify specifically which addresses to use for spending in a transaction. - http://github.com/bitcoin/bitcoin/pull/415


10

The only one I'm currently aware of is "Bitcoin Laundry" operated by Mike Gogulski. They charge a 4.555% commission rate and do little more than accept a payment then re-send a payment. There is also (according to the Wiki) that the service is only lightly used and might not be adequate to provide any real anonymity. You might be better sending then ...


10

I don't think the scenario is realistic because it would only punish innocent people. By the time coins could be marked as tainted, they would already be in the hands of innocent people. Governments don't do similar things with other currencies. For example, if you deposit dollar bills in a bank that turn out to have been stolen, the government could charge ...


10

It inevitably leaks information, but Bloom filters have a (controllable) false-positive rate. So a wallet client that is very concerned with privacy could make the false positive rate high enough so it becomes hard to distinguish which transactions the client was interested in.


10

This page on the bitcoin wiki explains the exact procedure for generating and using a stealth address. It's not very user friendly at this point in time and is considered experimental. Simply: Receiver generates a an address and a private secret and then sends this address to someone who he wants payment from. Sender uses the address and a "nonce"...


10

Let's assume you're the outside observer. You see 1 BTC go from aaa to bbb, then from bbb to ccc, then from ccc to ddd, and them from ddd to zzz (zzz being associated with service Z). Can you see how easy it is to figure out that addresses aaa, bbb, ccc, and ddd belong to the same person? It doesn't even get much better if you split the money to different ...


9

Dan Kaminsky has the idea that if you have enough bitcoin nodes/connections under your control, than by looking at how transaction spread across the bitcoin p2p network, you can determine ip address of a node that was the source of transaction, Blitcoin is suppose to be to the tool for that. I think that won't become a problem because use of a simple proxy ...


9

It is considered pseudo-anonymous. With casual usage, it is not very anonymous at all. Transactions occur between cryptographic addresses and anyone can create any number of these addresses. However, Bitcoin transactions can be traced back to your IP address. The history of all transactions can be analyzed for spatial and temporal correlations. If one ...


9

Knowing the Wikileaks donation address, one knows every address that contributed to them. Knowing a given address we are interested in, we can try tracing the coins back to when they were created (which can be harder if they were mined by a large pool, in that case you'd probably get a lot of origin blocks). Given an address we know when it received coins ...


9

As a peer: You can derive the approximate location (GeoIP for IPv4, latencies and allocations for IPv6) unless the node is operating as a hidden service. You can query the node for it's version number. You can query the node for current date and time. You can query some of the nodes recent connections with the addr host discovery mechanism, giving you ...


9

TCP and other stream based protocols do not have a 1-to-1 correlation of application level messages and IP packets. If you call send() 3 times, it might result in sending a single IP packet over the wire (eg, due to Nagle's algorithm which is enabled by default), it might get sent individually as 3 packets, as you would expect from a packet oriented protocol ...


8

If you purchase a bunch of Bitcoins with dirty money, and then sell the Bitcoins for clean money - you have essentially laundered your money with Bitcoins. You can then claim that your income came from Bitcoin mining, and it would be difficult to investigate. It is exceedingly difficult to anonymize your Bitcoin transactions. I think the appeal is that it ...


8

There are ways to acquire and use Bitcoins anonymously. This article for example states: install Tor and use it for all subsequent browsing steps visit Instawallet to anonymously create a Bitcoin wallet List $100 cash for sale on Silk Road Market Mail the cash through any US Postal Service drop box When the Silk Road bitcoin payment arrives, ...


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