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Author Topic: The Quest for Anonymity, or Why Exchanges are Not Really Exchanges  (Read 1655 times)
Blinken
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August 18, 2011, 04:01:02 PM
 #1

This subject kind of came up in the Newbies forum when one poster advertised wanting to buy bc for cash in Amsterdam and a respondent suggested using an exchange, doh.

The problem with the "exchanges" is that they are not actually exchanges, they are clearing houses that require you deposit coins with them so if they get hacked you lose your coins (Mt. Gox anyone?). Also, they all have registration processes and require either credit cards or an account with a cash-equivalent that requires a credit card (or bank account), thus your transactions are no longer anonymous, there is a digital trail back to you through the credit card/bank account.

So, the question is can you buy bitcoins anonymously? Yes, but its hard without a face-to-face transaction. For example, you could do the following:

(1) create an anonymous email account via a proxy
(2) start a Paxum account (which is anonymous) using the email address
(3) buy a postal money order using cash
(4) mail the money order to Paxum
(5) wait for the funds to be credited
(6) start a Tradehill account using the anonymous email address
(7) transfer funds from Paxum to Tradehill
(Cool buy bc with your Tradehill account
(9) delete all three accounts

Obviously a very laborious process. All you hear in BC is accounts accounts accounts, register register register. People don't seem to get that bc users want to be ANONYMOUS. They don't want to register and create accounts. When I go to the grocery store I don't want to be informing Star Market who the hell I am. I just want groceries, not a goddamn account.

Also, the anonymous process above only works for BUYING bc, not selling them. There is no formal way for anonymously selling bc that I can see. For example, if you reverse the Paxum process above they will send you a check, but you need to provide an address and if you cash the check you lose your anonymity at that point since all US banks now require ID or a verified account before cashing a check. You can no longer write checks to "cash" as you used to be able to. The only way around it I see is that you have the check made out to a coin store then hand deliver the check to the coin store and buy gold or silver with it, then sell the gold or silver, an 11-step process.

Obviously there is a need for exchanges to (1) be able support the transfer a coin without taking possession of it, and (2) send and receive anonymous cash payments (manila envelopes anyone?).


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spruce
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August 18, 2011, 04:07:15 PM
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Give it a bit of time. Then you'll be able to walk into a store which "does" bitcoin as a small sideline, like the "We send faxes, $1 per page" sideline. There will be many such stores in a town. You will be able to buy/sell/transfer BTC for cash on the spot, more or less (maybe a wait for some confirmations). The store will do the exchange/transfer at 1% or 5% over the going rate as their fee.
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August 18, 2011, 04:42:40 PM
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This site https://get-bitcoin.com/  offers Bitcoins for MoneyPak, and I think MoneyPak can be purchased at places like Walmart. Haven't tried it, but would be anonymous, no?
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August 18, 2011, 05:14:14 PM
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just to set something straight: Paxum isn't anonymous
xali
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August 18, 2011, 06:30:13 PM
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Haha I found a way a LOONG time ago by using virwox. Anything that accepts credit cards will do though. Why? Credit GIFT CARDS!! WOOO

Make silk road account.
Make virwox account
Link both accounts by walking up to a virwox terminal in game. (game not needed after this point)
Input USD with credit card on virwox (uses money bookers)
Convert to SLL
Convert to BTC

YAY


wait wtf which exchanges accept credit card? i thought none of them did?!? And the reason for this was same as no one accepting paypal, everyone uses chargebacks

Smiley ;/)
lettucebee
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August 18, 2011, 06:56:54 PM
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Haha I found a way a LOONG time ago by using virwox. Anything that accepts credit cards will do though. Why? Credit GIFT CARDS!! WOOO

Make silk road account.
Make virwox account
Link both accounts by walking up to a virwox terminal in game. (game not needed after this point)
Input USD with credit card on virwox (uses money bookers)
Convert to SLL
Convert to BTC

YAY


wait wtf which exchanges accept credit card? i thought none of them did?!? And the reason for this was same as no one accepting paypal, everyone uses chargebacks

Can you say this in English, please?
xali
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August 18, 2011, 07:20:24 PM
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If you're serious, explain exactly which part you don't understand.

Smiley ;/)
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August 19, 2011, 02:32:05 AM
 #8

Give it a bit of time. Then you'll be able to walk into a store which "does" bitcoin as a small sideline, like the "We send faxes, $1 per page" sideline. There will be many such stores in a town. You will be able to buy/sell/transfer BTC for cash on the spot, more or less (maybe a wait for some confirmations). The store will do the exchange/transfer at 1% or 5% over the going rate as their fee.

Agreed. At some point virtually everyone will be a potential exchanger. It would be like asking someone if they could "break a twenty". In the meantime, I suggest developing a local network of trusted trading partners. Join or start a MeetUp group and start networking. Collect contact info then simply put out the word when you need to buy or sell. The sooner you do this the less you will have to rely on the exchanges.
getbitcoin
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August 21, 2011, 04:22:32 AM
 #9

Hey there Blinken! We hear you 100%, and that's why we created GetBitcoin, a place to buy and sell Bitcoin online. We make it an easy, two-step process: just make an order in under a minute, and send us your payment. We handle everything else ourselves, and you'll get Bitcoin sent directly to you in under 24 hours, guaranteed. No accounts, no credit cards, no bank information, no wire transfers, no Paxum or Dwolla needed (although we do accept Dwolla payment too, if that's what you prefer). And it can be totally anonymous, with very limited restrictions (eg. we require ID for more than $1,000 in traveler's checks due to fraud risk).

Want some Bitcoin? Get-Bitcoin.com is the easiest way to get Bitcoin now. With low fees, over a dozen convenient payment options, and a 24-hour turnaround guarantee, Get-Bitcoin.com is one-stop shopping for all your Bitcoin needs.
ffuentes
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August 21, 2011, 04:37:27 AM
 #10

Hey there Blinken! We hear you 100%, and that's why we created GetBitcoin, a place to buy and sell Bitcoin online. We make it an easy, two-step process: just make an order in under a minute, and send us your payment. We handle everything else ourselves, and you'll get Bitcoin sent directly to you in under 24 hours, guaranteed. No accounts, no credit cards, no bank information, no wire transfers, no Paxum or Dwolla needed (although we do accept Dwolla payment too, if that's what you prefer). And it can be totally anonymous, with very limited restrictions (eg. we require ID for more than $1,000 in traveler's checks due to fraud risk).

But to sell you offer only cash (very insecure), check (not anonymous) or bank wire (even less).

Listen Radio Libre (Electronica) Donate. (click for details).

Chilean peso VS BTC ahora: http://irage.ca/2btc.php?a=1&c=CLP&r=1

My bitcoin address
helloworld
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August 21, 2011, 04:58:52 AM
 #11

If you're serious, explain exactly which part you don't understand.

I didn't understand this part:


Haha I found a way a LOONG time ago by using virwox. Anything that accepts credit cards will do though. Why? Credit GIFT CARDS!! WOOO

Make silk road account.
Make virwox account
Link both accounts by walking up to a virwox terminal in game. (game not needed after this point)
Input USD with credit card on virwox (uses money bookers)
Convert to SLL
Convert to BTC

YAY


wait wtf which exchanges accept credit card? i thought none of them did?!? And the reason for this was same as no one accepting paypal, everyone uses chargebacks

xali
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August 21, 2011, 07:42:14 PM
 #12

you can buy visa/mc/amex gift cards that work like credit cards with cash (buy anonymously). and then you can use said cards to buy anything that accepts credit cards. so now you find a place that sells bitcoins and accepts credit cards, like virwox.


get it?

Smiley ;/)
Jack of Diamonds
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August 21, 2011, 08:07:28 PM
 #13

Prepaid CC which can be reloaded with BTC just like the moneybookers mastercard, problem solved.

Banks will want customer verification as well which can pose a problem.
The trick is finding a bank in Eastern Europe etc. which will issue debit cards anonymously.

1f3gHNoBodYw1LLs3ndY0UanYB1tC0lnsBec4USeYoU9AREaCH34PBeGgAR67fx
Trader Steve
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August 22, 2011, 12:09:16 AM
 #14

Open Transactions (see links below) is a great tool for bitcoin. If you really want true anonymous cash transactions then Bitcoin + Open Transactions could be awesome. Bitcoin, specifically it's decentralized nature, is what was needed to make Open Transactions feasible for untraceable digital cash transactions. As FellowTraveler has requested, all that is needed is volunteers to help build it out. Those of us without programming talent can help with funding.

I've posted a thread link below for more info and I've posted the donation address as well:

http://forum.bitcoin.org/index.php?topic=20425.msg264740#msg264740

btc donation address to help this project along:

1NtTPVVjDsUfDWybS4BwvHpG2pdS9RnYyQ

More info:

https://github.com/FellowTraveler/Open-Transactions/wiki

and

https://github.com/FellowTraveler/Moneychanger
NghtRppr
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August 22, 2011, 05:57:18 PM
 #15

Also, they all have registration processes and require either credit cards or an account with a cash-equivalent that requires a credit card (or bank account), thus your transactions are no longer anonymous, there is a digital trail back to you through the credit card/bank account.

My service doesn't require that. You can buy BTC with no fees by cash through the mail.
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