Monero is quite anonymous, and https://xmr.to/ allows you to send small amounts of Monero and have them send Bitcoin for you. Just one solution of many to preserve privacy!
It is much much smarter compared to any electronic alternative. It is actually the smartest way to do it if done correctly. Only people who do not understand crypto say stuff like that.
The key assumption which underlies tracking UTXOs is that the people sending UTXOs to each other have some sort of real-world relationship and they are both using the same blockchain.
But this is not necessarily true. Two strangers could meet anonymously in an online chat and agree to trade e.g. Bitcoin for Ethereum using a cross-chain atomic swap. In this case the transactions occur on two separate chains, and any available metadata is likely very hard or perhaps impossible for a third party to discover.
Cross-chain swaps are an extremely rare, very power user move. If you discount them you're still left with the vast majority of transactions on the chain. I would guess over 99.9999% Most people who want a cross-chain trade just use an exchange like Coinbase.
But even if we decide to include cross-chain swaps, its not untraceable at all. You still need to verify hashes match up, its just an extra hop to have an oracle look on the other chain.
The metadata for cross-chain swaps are stored right on the blockchains for everyone to see.
The same time-locked hashes which make atomic swaps safe, permanently tag both sides of a completed atomic swap transaction with a unique hash making it easy to link them together.
Atomic swaps are not designed to prevent tracking of funds.
I don't people understand the potential consequences of using mixers and anonymized bitcoins.
If you have large sums in bitcoins you have anonymized and want to start withdrawing it as USD or some other currency, it can be confiscated unless you can proof it's origin (yes, there is reverse burden of proof).
Anonymize only bitcoins you use on the internet as anonymous user. Don't anonymize bitcoins you want to withdraw or convert into legal tender someday.
I don't understand people who insist on using a cryptocurrency that they have to jump through hoops to mix and hope they do it properly, spending lots of time and money on fees, rather than just using a cryptocurrency that is private by default.
Since Bitcoin is not fundamentally private, any attempt to tumble your BTC is fruitless because the Bitcoin blockchain and every transaction is public and transparent. There are even companies like Chainalysis[0] who profit off this fact and help law enforcement with e-crime. I imagine if Satoshi wanted to do Bitcoin again, she would bake in privacy as a core feature?
Just because every transaction is public does not mean that it's impossible to mix bitcoins, as transactions can have multiple inputs and outputs. It's difficult to mix, but keep in mind perfect information isn't available to those doing analysis, and companies like chainalysis also use a lot of off-chain information to help them draw conclusions.
Satoshi mentioned things like Ring Signatures. In another timeline, I think it's possible that Satoshi might have kept working on it to make it private by default.
Sidenote: The original author of CryptoNote which Monero is based on, Nicolas van Saberhagen, is also an anonymous identity like Satoshi.
Possibly not. Satoshi likely did not intend nor desire their currency to be used to facilitate crimes. In fact, they were infamously weary of WikiLeaks using the currency for donations due to the legal issues surrounding them, and WikiLeaks "crimes" are not comparable to say arms trafficking or something substantially illegal. The public nature of the BTC blockchain helps facilitate decentralized, equal participation.
This paper is about tracking Bitcoin through centralized mixing services. There is no mention of coordinated CoinJoin services, like Samourai Whirlpool or Wasabi.
Correct, not as far as I can tell. The methods they describe may be applicable to CoinJoin services (at least the very high-level methods are applicable), but they didn't show any testing with these sort of transactions (unless that's covered by one of the two "Unknown"s, which isn't likely).
What's the utility of this? Do people track bitcoins as part of their trading schemes? Or is this only something that the IRS & law enforcement would do?
It's extremely hard not to taint addresses in Bitcoin. As an example if you have a Trezor (which makes using Bitcoin safe and easy) and buy another one as a backup, you can't export your private key from the original one, but you can easily send all Bitcoins to a new address. The only option you have is to get the paper backup (which is guarded somewhere physically separated from your Trezor) and use that to initialize the new device.
That's just how wallet backup works, I'm not sure how that is related to taint.
Perhaps a better illustration of the taint issue is "change". Whenever you need to send an amount of bitcoin that does not exactly match one of the UTXOs ("unspent transaction output") in your wallet, you will
- potentially need to use multiple UTXOs as input (thus linking together the past transaction that produced them)
- very likely have a "change" output that sends the excess amount back to a new address in your own wallet. Which output is change can be guessed with heuristics, and that UTXO will eventually be used in a future transaction, linking it to the current transaction.
Basically, all transactions associated with a wallet tend to become linkable over time.
Bitcoin mixers aren't private as the real transaction is in the mix-set somewhere and it is really a matter of time until a determined researcher will find it. Mixers work better the higher number of coin-joins in the mix, and it is better than nothing in that sense, but it gives users a false sense of privacy.
Privacy can be had in obfuscating your Bitcoin by sending them using the Lightning Network. You have your own LN Channel and then send them to yourself routing through as many other channels as possible. Bitcoin cleaned.
Another way is to use ZCoin. Zcoin uses zero knowledge proofs which burns the minted coin and redeems a new coin. SO I convert my 0.5 Bitcoin to Zcoin, the orginal transaction iin Zcoin is burned and new equivalent Zcoin is minted. No trace.
Monero is good but it is now under attack by Chainalysis to crack it on behalf of the IRS.
When it comes to anonymity from the solutions available; coinjoins, Monero or Zcoin, personally Zcoin seems the most private way to obfuscate one's blockchain trail.
A Zcash user recently made a challenge for anyone to tell where his coins came from that went from taddress->zaddress->zaddress->taddress. The winner only had to look at past public transactions and find the same coin amount to find the original t-address.
That is why privacy-by-default is very important, and why right now Monero should be considered more private.
Monero has been "under attack" for a long time now, well before the IRS started giving money out. There are possible attack vectors and subsequent remedies. The Monero people made a series called Breaking Monero where they talk about all of that stuff.
[+] [-] seibelj|5 years ago|reply
[+] [-] vmception|5 years ago|reply
no limit on distinct orders.
Americans just turn on your VPN to access the frontend website, the server and operator don't actually care.
[+] [-] heimatau|5 years ago|reply
Don't trust, verify. [1]
[1] - https://monero.org/monero-vs-princeton-researchers/
[+] [-] giancarlostoro|5 years ago|reply
> XMR.to is currently not available in your region.
I guess no Americans allowed
[+] [-] peteretep|5 years ago|reply
[+] [-] uHuge|5 years ago|reply
[+] [-] ravingraven|5 years ago|reply
[+] [-] porcine-flight|5 years ago|reply
But this is not necessarily true. Two strangers could meet anonymously in an online chat and agree to trade e.g. Bitcoin for Ethereum using a cross-chain atomic swap. In this case the transactions occur on two separate chains, and any available metadata is likely very hard or perhaps impossible for a third party to discover.
[+] [-] dgrin91|5 years ago|reply
But even if we decide to include cross-chain swaps, its not untraceable at all. You still need to verify hashes match up, its just an extra hop to have an oracle look on the other chain.
[+] [-] phire|5 years ago|reply
The same time-locked hashes which make atomic swaps safe, permanently tag both sides of a completed atomic swap transaction with a unique hash making it easy to link them together.
Atomic swaps are not designed to prevent tracking of funds.
[+] [-] nickthemagicman|5 years ago|reply
[+] [-] Nokinside|5 years ago|reply
If you have large sums in bitcoins you have anonymized and want to start withdrawing it as USD or some other currency, it can be confiscated unless you can proof it's origin (yes, there is reverse burden of proof).
Anonymize only bitcoins you use on the internet as anonymous user. Don't anonymize bitcoins you want to withdraw or convert into legal tender someday.
[+] [-] RandomBacon|5 years ago|reply
[+] [-] nubela|5 years ago|reply
[+] [-] apples_oranges|5 years ago|reply
[+] [-] katsume3|5 years ago|reply
[0] https://www.chainalysis.com/
[+] [-] ve55|5 years ago|reply
[+] [-] RandomBacon|5 years ago|reply
Sidenote: The original author of CryptoNote which Monero is based on, Nicolas van Saberhagen, is also an anonymous identity like Satoshi.
[+] [-] jmt_|5 years ago|reply
[+] [-] zapdrive|5 years ago|reply
[+] [-] clarkmoody|5 years ago|reply
[+] [-] sgp_|5 years ago|reply
[+] [-] ColanR|5 years ago|reply
[+] [-] shiado|5 years ago|reply
[+] [-] RandomBacon|5 years ago|reply
[+] [-] intotheabyss|5 years ago|reply
[+] [-] antonios|5 years ago|reply
[+] [-] xiphias2|5 years ago|reply
[+] [-] wcoenen|5 years ago|reply
Perhaps a better illustration of the taint issue is "change". Whenever you need to send an amount of bitcoin that does not exactly match one of the UTXOs ("unspent transaction output") in your wallet, you will
- potentially need to use multiple UTXOs as input (thus linking together the past transaction that produced them)
- very likely have a "change" output that sends the excess amount back to a new address in your own wallet. Which output is change can be guessed with heuristics, and that UTXO will eventually be used in a future transaction, linking it to the current transaction.
Basically, all transactions associated with a wallet tend to become linkable over time.
[+] [-] unknown|5 years ago|reply
[deleted]
[+] [-] HashingtheCode|5 years ago|reply
Privacy can be had in obfuscating your Bitcoin by sending them using the Lightning Network. You have your own LN Channel and then send them to yourself routing through as many other channels as possible. Bitcoin cleaned.
https://bitcoinmagazine.com/articles/how-the-lightning-netwo...
Another way is to use ZCoin. Zcoin uses zero knowledge proofs which burns the minted coin and redeems a new coin. SO I convert my 0.5 Bitcoin to Zcoin, the orginal transaction iin Zcoin is burned and new equivalent Zcoin is minted. No trace.
Monero is good but it is now under attack by Chainalysis to crack it on behalf of the IRS.
https://cointelegraph.com/news/chainalysis-and-texas-firm-wi...
When it comes to anonymity from the solutions available; coinjoins, Monero or Zcoin, personally Zcoin seems the most private way to obfuscate one's blockchain trail.
[+] [-] RandomBacon|5 years ago|reply
That is why privacy-by-default is very important, and why right now Monero should be considered more private.
Monero has been "under attack" for a long time now, well before the IRS started giving money out. There are possible attack vectors and subsequent remedies. The Monero people made a series called Breaking Monero where they talk about all of that stuff.