In this digital era, it is hard to hide your complete details. All your internet activities are somehow recorded for making a profit or trace you to make a sure you’re not involved in illegal stuff.

If you believe that Bitcoin activities are completely secure, nobody traces you whatever you do.

Then guess what it is hard to say but, Bitcoin transactions are not 100% anonymous.

Bitcoin transactions are called Pseudonymous.

If you’re wondering what is Pseudonymous means then, I give you a simple example.

Let’s assume you have created a new Bitcoin wallet and received your Public and Private keys to send or receive Bitcoins.

In the blockchain, your Private key is kept private and not seen by anyone, but Public key is used to send and receive Bitcoin that means it is publicly viewable.

If your public key linked to your identity, then every transaction will be linked to you.

These characteristics made Bitcoin as one of Pseudonymous cryptocurrency.

Ok, now look at some methods to add in Bitcoin transaction to make it completely anonymous.

Use a VPN.

VPN stands for Virtual Private Network, and it is one of an easy way to surf the internet anonymously.

The VPN service provider encrypts all your internet activities in their multiple servers at different locations, and you have the control to chose the best server for you to access the internet.

I strongly recommend you to read my previous post on the benefits of VPN in crypto trading, and you will understand how VPN works and their benefits in crypto activities.

All VPN service providers do not provide you with a fully encrypted and anonymous internet browsing facility.

Instead, they store your login credentials and your browsing history on their servers.

That’s why I recommend you to use a good premium VPN service that offers guaranteed anonymity.

Use TOR Browser.

TOR means The Onion Router this browser helps you to surf the internet anonymously.

The first time it looks like a normal browser but, when connecting to the internet, this browser encrypts data then send that data to the random computer nodes on the Tor network before it reaches its final destination.

This browser makes different layers of IP address in their network to get final information, in this way, all your details and other activities couldn’t be pointed to your I.P & thus helps you stay anonymous.

But when using KYC enabled Bitcoin sites like Coinbase or any other, then using TOR is not so useful. However, when using P2P sites like LocalBitcoins or Paxful, TOR is highly recommended.

Also, you can use I2P, Bitmessage, Freenet, ZeroNet to stay anonymous on the internet.

Note: You can use a VPN and TOR together to maximize your privacy.

Use New Address For Each Transaction.

In Bitcoin, you can generate the new public address while making each transaction.

You already know that Bitcoin blockchain is transparent that means anyone able to see the sending and receiving address of the transaction and also able to analyze the transaction address.

For example, see below image of a particular address.

Above Image, you can see how many transactions made and how many Bitcoins it have.

I already mention that if a particular address link to a particular person identity, then it becomes very easy to analyze that person transaction behaviour.

To solve this problem, you can create a new address when making each transaction for that you can use any HD (Hierarchical Deterministic) wallets.

Hd wallets generate new address when making the transaction and they back up the new address each time.

Some recommended Hd wallets are Ledger Nano S, Trezor and Wasabi Wallet.

Use JoinMarket.

JoinMarket is a market place where bitcoin senders and receivers come together to make CoinJoin transactions.

CoinJoin transactions require multiple parties to mix their coins when engaging in separate transactions.

For example, A wants to send Bitcoin for B, at the same time C wants to send Bitcoins to D and E want to send Bitcoins to F. Without CoinJoin, the public blockchain ledger would record three separate transactions for each input-output match. In CoinJoin ledger would show that bitcoins sent from A, C, and E address to B, D, and F address.

These type of group mixed transactions are hard to determine who sent the Bitcoins to whom.

Note: Bitcoin mixing is done by break the link between Bitcoin addresses by either creating temporary addresses or by swapping coins with other addresses of the same value.

The interesting thing is the CoinJoin mechanism enables mixing coin without any Centralized parties involvement.

But CoinJoin requires 2 or more parties agree to make transactions some times it is hard to find out more senders and receivers who want to make transactions.

In JoinMarket you can easily find more people to for making CoinJoin transaction.

JoinMarket introduced the maker-taker concept to make CoinJoin transactions.

Here, takers are silently waiting until a maker wants to make a CJ transaction and ask a couple of makers if they want to provide liquidity for a small fee.

In the below image, you can see how JoinMarket transaction look like.

Can you able to figure out who send Bitcoins to whom?

I bet you are not able to find who sent Bitcoins to whom.

Use JoinMarket now to do CoinJoin transactions.

These are the ways to transact in Bitcoin anonymously but above are the not only way to do Bitcoin transaction anonymously.

Other Ways…

There are other ways exist like face to face Bitcoin transaction on P2P exchanges.

For Example, use VPN and TOR together to signup the P2P exchange like LocalBitcoins.

When signing up use Fake Name and Email (you can find fake email and name generators easily online) then find the trustable buyer/seller, contact them using a public phone to coordinate a meeting in public place where you can easily access to public WiFi.

At last, reach the venue, transact and wait for 2-3 confirmations you’re done😊.

Note: At the time of making transaction never use your vehicle to commute as your vehicle number can expose your identity.

As you noticed these other ways are little cheeky, that means you have to figure it out on yourself.

For that, you have to be a creative person that’s why it is easy to follow above main steps what I mentioned.

What I Don’t Recommend.

Firstly I don’t recommend you to use any Bitcoin mixers.

There are many Bitcoin mixers available on the internet, some are complete scams, others are legit and charge a fee, and still, others selectively scam their customers.

Even if they don’t rip you off, you have no idea how they are mixing your coins if they are providing sufficient anonymity, and you have no guarantees they are not deanonymizing everyone themselves.

That’s why using mixing services is extremely risky.

Note: Bitcoin Mixing also called as Bitcoin laundering, Bitcoin washing or Bitcoin tumbling.

Secondly, I don’t recommend you to use any free VPN services.

Because free VPN services don’t offer full anonymity for a long time, that’s why I recommend you to buy any premium VPN service and make sure to check the public review before buying any VPN services.

Methods To Track Bitcoin Address.

You already know that Bitcoin is a Pseudonymous currency and I showed you an image of bitcoin public address details to prove that.

But that is a small thing because anyone can go to Block explorer website and able to see Bitcoin transactions and their sending and receiving address.

Above method to track public address can be done by any person who has little knowledge in technology but to crackdown public address origin, you must have sharp analytical skills.

Let me clear something for you that I don’t have the sharp analytical skills that required to track Bitcoin address, but I have the curiosity to know the methods to crack Bitcoin address.

For knowing what are the methods used to track Bitcoin address I just researched online and here is what I found.

Now Blockchain analysis has become a billion-dollar industry with blockchain forensic services charging top dollar for their analysis to law enforcement governments, banks, and major Bitcoin exchanges worldwide.

Chainalysis will give you a good idea of the services those blockchain forensic firms offer.

These kinds of firms use a method of guessing what is taking place on the blockchain, in the sense of monitoring movement of funds. They do this with a technique called heuristics.

Here are the various heuristics utilized by blockchain forensic analysis companies like Chainalysis.

#1 Multi-Input Heuristics: This method assumes all inputs are from the same wallet.

#2 Shadow Change Heuristics: This method analyzes change addresses that have never before been on the blockchain, lets blockchain analysis experts know who is the sender and who is receiving funds.

#3 Consumer Change Heuristics: In this method, the analyst assumes that transaction from consumer wallets have two or fewer outputs, on that basis, they identify people using services like exchanges, webstores, etc.

#4 Optional Change Heuristics: This method uses the assumption that wallets don’t send unnecessary outputs, if there is a unique output with a smaller value than any of the inputs then this is the change.

These different techniques are used by themselves or in varying combinations in an analysis technique called “Clustering”.

I was able to find out one method called Clustering used by firms like Chainalysis.

If you know some other methods, then mention those in the comment section.

Now I believe that you’re able to transact in Bitcoin anonymously with full awareness.

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