Untraceable Bitcoin: Are BTC Payments Anonymous and Transactions Really Private?
Bitcoin (BTC), the largest and most popular digital currency in the world has been used to perform transactions that allow users to remain anonymous. Privacy is something that many individuals are trying to protect in times where data moves at all times on the internet. Bitcoin was able to offer a new method for payments that are in charge of protecting users’ information. The main question is whether Bitcoin is as anonymous as we suppose.
Bitcoin And Its Anonymity Features
Bitcoin is now on the media after being able to surpass $7,000 a few hours ago and leave a bear market behind that started in January 2018. The cryptocurrency market is now very excited about the future of the cryptocurrency and how it could keep expanding.
Bitcoin has been growing as a digital currency that can be traded and that users can use without being experts. One of the main features that Bitcoin has is that it provides users with a string of letters and numbers that protect the identity of those transacting with it.
Although many individuals think that Bitcoin is anonymous, the digital currency is pseudonymous. That means that transactions can be linked with a specific address in certain circumstances. People with knowledge would be able to know from where and to where a Bitcoin was moved.
At the same time, companies that allow users to buy and sell digital assets require personal information for the firms to be compliant with Know Your Customer (KYC) and Anti Money Laundering (AML) regulations. That means that the firm is in control of the user data and who perform a transaction. Additionally, funds are not as safe as if they were in hardware or cold storage wallet.
Nonetheless, if the digital currency is used directly with another user, individuals are not required to provide any data per se.
There are other digital currencies that offer better privacy features than Bitcoin. Some of these digital assets include Monero (XMR), ZCash (ZEC) and in the future eventually Litecoin (LTC), among others. These digital assets use different systems and implementations that obfuscate transactions and allow users to have their privacy protected.
Users that want to keep using Bitcoin can activate a VPN that will provide them with more privacy and protection. Moreover, Bitcoins can always be mixed in different websites, making the digital currency less trackable for blockchain analysts.
Although Bitcoin is not completely anonymous, it is very useful for making international transfers and storing value.