Bitcoin the anonymous cryptocurrency

[Etsu]

Message from anonymous bitcoin community members for other members explaining how bitcoin is working for the last ten years. Its a platform developed for entire humanity by humans. The protocol is robust enough to defend itself against all hacks. Even the developers of the protocol can't change or manipulate it. It is very likely that the developers of this protocol are with us all the time.
What we need is to stay safe in this current crisis, as this crisis will be over just like all crises of history. Be safe!

You're right about one thing though,  just like every other pandemics and global crisis that led the world into a global crisis, the COVID19 will also pass and when it does the entire world will emerge strong as we've learn a lot and measures will be provided to better the world. I strongly believe the cryptocurrency market will emerge stronger too, who knows if bull is already lurking around the corners?

[Wexnident]

Yes its close to being anonymous but the norm system developed pretty much prevents the that anonymity. Yes, it'd be hard to trace, but only hard, not impossible. The difficulty lies on tracing the numerous amount of wallets that passed through the exchange. P2P and decentralized doesn't have this problem, but centralized exchanges have this kind of system. You can see this by checking out some hacks that have happened in the past, and where exchanges are able to trace where the said coins were, albeit not all of them.

[Japinat]

The longer bitcoin will exist the more we loss its anonymity as the government will regulate it and with strict regulation, we will be able to comply with the KYC and pass the requirement of the exchanges. In blockchain, we are anonymous but in the eyes of the regulars, we are not.

[Twentyonepaylots]

The longer bitcoin will exist the more we loss its anonymity as the government will regulate it and with strict regulation, we will be able to comply with the KYC and pass the requirement of the exchanges. In blockchain, we are anonymous but in the eyes of the regulars, we are not.

In short the anonymity we have is limited to those who can see in the dark, for most people addresses in the blockchain is different to another when in fact it is very possible to know however people behind exchanges can barely see it especially when we have our own identity passed to them, everything that goes in and out are being recorded and is traceable to the account. We are not really anonymous, we just think it the easy way escaping the fiat's one disadvantage.

[fenixosup]

Maybe you are talking about Monero? Bitcoin is easy traceble

[20kevin20]

The longer bitcoin will exist the more we loss its anonymity as the government will regulate it and with strict regulation, we will be able to comply with the KYC and pass the requirement of the exchanges. In blockchain, we are anonymous but in the eyes of the regulars, we are not.

Stop using centralized services then and start supporting real p2p and decentralized ones. That's how you decrease government control and, at the same time, increase privacy. You're not anonymous on blockchain. In fact, if you take the wrong steps and no precaution, even Monero doesn't make you anonymous. Everything has some steps you have to check if you truly want your identity to be preserved.

Lawmakers, regulators will always look for a way to deprive you from privacy and anonymity. If you're willing to hide in a shadow, you become their target - simple as that. If you keep up with their requirements and under their control, you'll likely be left alone.

[ToothlessCoin]

I have a wallet through which I access bitcoins. Tell me how can you trace me since you only have my wallet address?

Bitcoin was not designed to make transactions anonymous. Every transaction you make is linked to a public key. In fact, your wallet address is just the hash of your public key. Theoretically, somebody could connect the payments you make to other bitcoin addresses to construct a group of wallet addresses that you are likely to control. This method is called address clustering, and address themselves are usually analyzed instead of their public keys.

Example: One of satoshi's wallet addresses is 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa. If I feed this into Wallet Explorer, it will show you the transactions that were made with this address. Here it will also list the addresses associated with your wallet.

Since that wallet only has one address in it, I'm going to provide another well known address as an example. This address 1XPTgDRhN8RFnzniWCddobD9iKZatrvH4 was the one used by laszlo to purchase 10000BTC worth of pizza. When you insert that into wallet explorer, it will list all the other addresses associated with his wallet.

Now you're probably wondering at this point how someone could discover your identity from these wallets. The short answer is I'm not sure, the long answer is that there exists a company called Chainalysis that does these kind of address clustering activities. I think they also know the addresses belonging to exchanges. So if anybody that uses Chainalysis service, which is limited to governments and large institutions, gets some transactions linking one of your wallets with a known exchange wallet, and manages to see your documents, then they can store your personal information along with your wallet addresses in whatever database they are using.

Or you could look at the addresses of bitcointalk members and then wallet explorer could identify their other addresses, but not much information about their identity would be inferred since most of us are pseudonymous.

These methods of address identification fall apart completely if you use mixers to break the link between previous transactions and now.

Thanks for this lovely explanation. So BTC is not anonymous its pseudonymous. Since we can be tracked by our wallet address not by our physical ids.