Wow! Exchanges track how you spend btc!

[Yakamoto]

Apparently this guy sent it to multiple different wallets before gambling with it, but coinmama found out and has banned him

https://www.reddit.com/r/Bitcoin/comments/bdr9nw/coinmama_is_a_nosey_bitch_tracking_your_coin/

Makes me wonder if Monero or some other privacy coin is the future. I realize he can go to an atm, buy from local bitcoin etc, but a lot of people don't have access to ATMs or don't feel comfortable with P2P. Anyway, what do you think about this? Privacy coins are the way to go, or are their privacy features just waiting to be unravelled?

Exchanges are often bound by government regulations once they exceed a certain size, then they have to start complying with laws which often require the exchange to actively take a role in monitoring the activity of their users. It's a nasty thing, and I couldn't ever support it, but that's how it is.

As for the future being based around privacy coins or some other method of limiting the traceability of Bitcoin being implemented, it's unlikely. The community will have to identify their own ways of circumventing the monitoring that does occur, otherwise, they will have to comply with whatever restrictions are placed on them. It's unfortunate, but that is what happens.

I don't think there will ever be a major shift to a privacy coin within the community, but casinos may recommend their use as a means of avoiding the restrictions and spying performed by exchanges.

[DigitalCyberius]

Hmm, that's interesting, but not too surprising. Not sure if anything will change in the near future. We like privacy, but unfortunately, it's been smeared with a bad reputation (which also isn't surprising). You still have the option to use privacy coins if you want, but probably won't get mainstream adoption.

Have a good day,
The Cyberius team.

[Pursuer]

exchanges and generally any centralized place have always been tracking how you spend bitcoin and what you do with it. that is not a new thing not to mention that each of these services have clear Terms of Services which you agree with when you start using them so you can't really complain when they did what they promised you to do!

in fact that is why bitcoin exists, so that when you dump your fiat for bitcoin you no longer have to answer to anybody about how you choose to use your own money!

[Icygreen]

#1. Yes, Bitcoin needs better privacy.  We don't need another coin to do it for bitcoin because it'll be built on top. Schnorr signatures and mimble-wimble are attempting to solve some of this now and segwit is the base layer entrance to allow these to happen without a hard fork.  Good things take time to build, be patient.

#2. I respect what I think coinmama is trying to do.  I think that it wants to re-associate BTC with real people and not perpetuate that BTC is only for gamblers, crooks, drug dealers and degenerates.  I don't like that they want to play central authority to a permission-less tech.  Seems ridiculous. Censorship is not the way forward.  

[bitbunnny]

There is some kind of conflict between privacy of Bitcoin users and legal provisions and obligations for exchanges and other platforms.
From the begininig Bitcoin has lost a great deal of privacy due some techiques that ebable tracing transactions but also because of KYC rules and anti money laundering and anti terrorism financing laws. To my opinion law obligations could only get more strict so Bitcoin users will have to decide what is more important to them, privacy or general protection and safety.

[DBronze98]

This post have a two faces,a possitive sude and it's negative side. I can say that the possitive side of this issue is our bitcoin will becone more secure because there is an monitoring but I am afraid on the negative side that it can abuse about our privacy because they can view and see our every transaction I think our freedom as a bitcoin owner will violate.

The blockchain system is known to be highly hierarchical and private. I find this very bad when you're self-right violated by anyone you don't want. Controlling transactional information is also one of the ways that wives control husbands who are gambling on the Crypto platform  It is a fun share of me and hope not to attack anyone here.

[jmigdlc99]

No surprise here. Companies collect your data, even in crypto.

Heck they even offer to pay people to do it and people willingly accept. E.g. membership reward cards and all those reward point schemes. You get points discounts and freebies as the cost of the company collecting data on what where and how you buy things. They use data to control consumers.

If privacy is the goal then truly decentralized and privacy centered crypto is the way to go.

[Kakmakr]

Coinbase does this exact thing if I'm not mistaken.  Crypto gambling is illegal in the states to the best of my knowledge, and if they see you depositing bitcoin from a casino or withdrawing it to one, Coinbase will delete your account.  That was true as of a couple of years ago when I heard it was happening but I don't know if that's still their policy.

It should not come as a surprise to anyone that exchanges do this.  Just like with kyc policies they have to protect themselves and comply with gov't regulations.  They don't advertise the fact that they track you, of course, but most of the big exchanges are probably doing it.

Yes, it is illegal and one of the reasons why a lot of people have lost all their coins or access to their accounts on Coinbase. This is also one of the reasons why you do not use exchanges as a wallet, but rather a way to buy bitcoins to transfer it via a mixer service to another wallet. You then spend the coins from that wallet and not directly from the exchange wallet.

The same goes for the bitcoins that you received from gambling, do not deposit those coins directly from the gambling site. Send it to another wallet and then channel it through a mixer, before you send it to the exchange. 

[BitHodler]

exchanges and generally any centralized place have always been tracking how you spend bitcoin and what you do with it. that is not a new thing not to mention that each of these services have clear Terms of Services which you agree with when you start using them so you can't really complain when they did what they promised you to do!

This. I fail to understand how people continue to complain about how bad centralized exchanges are while they agreed to all terms (terms 99.9% of the people are too lazy for to read) before their account was created.

What I also noticed is how people have been hyping up decentralized exchanges, but most of them haven't even tried using it. They either point at low volumes or that these exchanges aren't developed enough.

Low volumes is not an excuse because most people can only afford low amounts anyway. Not being developed enough isn't an excuse either because they allow you to buy and sell, what more do you need?

The only point of valid criticism is that you can't day trade on decentralized exchanges the way you can do it on centralized exchanges.

[blueteam09]

With exchange platforms that track user history is a criminal act when trying to track the privacy of others. I have every right to make the transactions I want and are not allowed to follow my history. We need to ask these exchanges to stop their customer tracking activities because this is a violation. Crypto investors all want their identity as secure transaction history.

[susila_bai]

I think that they have done this because the user used the funds for gambling that is the main reason of banning him, Apart from that withdrawing to multi address should not be problem, if i am not wrong.

[Pursuer]

#1. Yes, Bitcoin needs better privacy.  We don't need another coin to do it for bitcoin because it'll be built on top. Schnorr signatures and mimble-wimble are attempting to solve some of this now and segwit is the base layer entrance to allow these to happen without a hard fork.  Good things take time to build, be patient.

you are wrong about almost everything here!
first bitcoin does not "need" better privacy. it already offers a very good level of privacy. what you had in mind is anonymity and that will not happen either since bitcoin doesn't need that either.
secondly, Schnorr signatures are not for privacy! there is only one thing that is remotely related to Schnorr and that is the aggregated signatures that offers a little privacy for multi signatures not generally.
as for SegWit, we still need a hard fork to enable things such as Schnorr since it is changing the way signatures are calculated and will probably need a new OP code which doesn't exist at the moment.

[maydna]

That is why bitcoin has services like bitcoin mixer so they can not track on how we spend our bitcoin. At least, if they still want to track, they will difficult to located on where we spend the bitcoin. But yes, in these situations, I think using monero will be good.

Perhaps, the strategy to use bitcoin for gambling would be like this:
1. We have bitcoin, and we send it into exchanges which don't use KYC.
2. Then exchange it into other coins which is available on the gambling website and then send it into the gambling site and then you can play many games.
3. When you can win, you can send it into the exchanges and sell it to convert into bitcoin.

That strategy will be a bit confusing but I think that will works wells

[muslol67]

Apparently this guy sent it to multiple different wallets before gambling with it, but coinmama found out and has banned him

https://www.reddit.com/r/Bitcoin/comments/bdr9nw/coinmama_is_a_nosey_bitch_tracking_your_coin/

Makes me wonder if Monero or some other privacy coin is the future. I realize he can go to an atm, buy from local bitcoin etc, but a lot of people don't have access to ATMs or don't feel comfortable with P2P. Anyway, what do you think about this? Privacy coins are the way to go, or are their privacy features just waiting to be unravelled?

It may be useful to use mixer applications for such situations. Or, using DEXs, you can make the money untraceable. We are losing our decentralized system slowly. So, we have to be careful more.

[CBANX2]

It depends on the exchange's terms of use, in order to prevent some keos they track send and receive Bitcoin transactions through their exchanges.
 

[pinoyden]

Privacy coins are private and that means you cannot be traced but bitcoin can also do that because there are now services called mixers where you can mix you bitcoin so that no one can trace your original source on where did you got your bitcoin or who is the original owner of it  .  sure exchanges can track your coins after you withdrew or deposit them but that is not their job . whats the point of doing it to thier costumer  ?

[Virtual miner]

Apparently this guy sent it to multiple different wallets before gambling with it, but coinmama found out and has banned him

https://www.reddit.com/r/Bitcoin/comments/bdr9nw/coinmama_is_a_nosey_bitch_tracking_your_coin/

Makes me wonder if Monero or some other privacy coin is the future. I realize he can go to an atm, buy from local bitcoin etc, but a lot of people don't have access to ATMs or don't feel comfortable with P2P. Anyway, what do you think about this? Privacy coins are the way to go, or are their privacy features just waiting to be unravelled?

When you signup for any exchange you agree to give your privacy into the hands of a third party. It's pretty obvious that when any exchange doesn't gives you a private key of the wallet then that exchange has whole control of your wallet. So they can surely track you to. I don't find anything like sad in this. The user should have used a private key monero wallet or should have used a good mixer so that it was impossible to track him down. There are ample of people using this it's for the very first time I have seen such a case.

[kingplaya4]

Gambling is pretty stupid- How many of us would have a lot more BTC without it? But I fail to see the big deal with it. It is not a criminal act to throw my money in a garbage can should I choose. I think you guys underestimate how much bitcoin is currently supported by the gambling economy. America just legalized sportsbetting and will likely catch up with europe on other games at some point. People are going to gamble whether the government agrees or not, and I don't think this use should be a smear on bitcoin. That's pretty nutty that TOS includes that, that should be a pop-up warning message or at least on coinmama's main page, but of course they'd rather have it somewhere they know people won't read it so they can make the sale then close the account on you.

[Slow death]

Some people have commented on this and I want to add some things. we have to stop with things like these:

Coinmama is a nosey bitch tracking your coin.

bitcoin is decentralized. but we can not oblige exchanges that have their owners to be decentralized. The exchanges must respect the laws of the governments and they certainly do not want to have problems with the governments.

About anonymous currencies, if every year we are under pressure from governments, eventually we will have a highly regulated market and the anonymous currencies will be targets of governments and I believe that few people will risk using anonymous currencies

[dothebeats]

Cool thing to know that Coinmama's ToS extends well beyond their grasp. I mean, once people bought something from you, shouldn't consumer-merchant relation already end there once people paid something "in full" from you? I think in this instance, Coinmama still wants control from the coins they released to people and that's somewhat scary. Not that I'm with the dude gambling or anything but it's not Coinmama's business anymore on where will the coins be used.

Perhaps those who want to gamble wants to use the aid of privacy coins or mixers just to avoid getting banned from exchanges.