Anonymity in Bitcoin”s world is still a very important topic for the world society. Whereas people try to improve Bitcoin”s anonymity, new ways of revealing the identity of users of cryptocurrencies are emerging simultaneously. So how to make bitcoin transactions anonymous? Below some basic ways to protect yourself and your personal data in the Bitcoin network are described.
One of such ready-made solution is the utilization of TOR or any other methods of hiding the IP address. If this transaction is made with help of TOR, it is almost impossible to find out by whom it was made (of course, if there are no vulnerabilities in the TOR itself).
Other simple way to develop safety is creation of new address for each transaction. Then it becomes more difficult to adhere addresses to particular person, as it requires to apply much more efforts. More and more Bitcoin-purses do it mechanically, through hierarchical-determined (HD) software.
To make bitcoin transactions anonymous users can utilize Zerocoin. It is based on a mathematical approach to encryption. Anonymization of payment transactions and encryption of chains is even stronger here than in all previous projects. In fact, it is another quasi-currency based on bitcoins that are converted into own, individual crypto money. The only information that can be recorded here during the transaction is the very fact that the transaction has occurred.
Zerocoin initially worked as an addition to the bitcoins, but did not get enough popularity. To the level of Bitcoin this startup, of course, does not grow. But, it allows you to exchange your own crypto currency for bitcoins and store money in a more secure form.
Use of mixers to increase Anonymity
A little more difficult way to provide safety is to use of so called mixers. Plenty of the types of mixers exist, but all of them are similar in one: all people using mixer receive bitcoins of each other. Well carried out “mixing” of bitcoins makes difficult the execution of analysis of transaction networks, as well as “analysis of dissemination ”. These operations can be made a few time to increase their safety .
One of the examples of mixers is CoinJoin, which absorbs entrances and exits of a few users to one transaction, breaking in such a manner assumption that all entrances belong to one person. Nevertheless CoinJoin cannot clear entirely bitcoin-address from traces, as entrances and exits are all the same connected to them.
Some other mixers can help to get rid of all traces, returning to you bitcoins from absolutely other address belonging to the mixer itself. Nevertheless, usually such mixers are centralised, thereby they know addresses appurtenant to their users.
To protect from quantitative analysis, mixers can include identical amounts to one transaction. As alternative mixers can collect as well the remuneration of random size that complicates search of communication between sent and returned bitcoins. It is possible to separate mixed amount to a few parts.
Before sending coins back, it can be some delay from mixers. The more is this temporary interval, the more difficult to connect transactions. Enlargement of the time of “mixing” enhances similarity of concealed transactions with common transactions.
Also, if only you do not intend to get transparent public donations or payments, showing your bitco-address in a public place, like a web page or social network – is not a good idea in terms of confidentiality. In case you make it real, always remember that if you move any funds from this address to another address, it will be publicly fixed in the history of your public address. In addition, perhaps you should not post information about your transactions and purchases, which can give someone an opportunity to calculate your bit-address.
In addition, to answer a question “how to make bitcoin transactions anonymous”, you must use a new bitcode address each time you receive a payment. In addition, you can use several wallets for different purposes. In this way, you isolate your transactions so that no one can connect them to each other. People who transfer money to you will not be able to find out what purses is you own, and what you do with them. Always remember this, this moment is very important.But in the end, Bitcoin”s security depends on the specific user and his or her requirements. It does not depend on a code. Owners of Bitcoin can utilize a specific level of anonymity depending on how much personal information they disclose, what methods of protection they use, how frequently and how much they do it.