How anonymous is Bitcoin?

[Brendan Burgess]

Anonymity is one of the main advantages mentioned in discussions of Bitcoin.

But I see that Coinbase was ordered by the American courts to give over details of its customers to the Revenue.

The court order requires Coinbase to hand over info on all customers who made a transaction worth $20,000 or more between 2013 and 2015. Coinbase has estimated that this request would total 8.9 million transactions between 14,355 different account holders, according to the court order.

The bitcoin exchange Coinbase has been ordered to hand the IRS info on 14,355 of its highest-rolling customers

"Among the information requested are the names, birth dates, addresses, tax IDs, transaction logs and account invoices of the Coinbase users."

If I buy a Bitcoin tomorrow, I will have to give someone $20,000 for it. Does that not create a record?

Likewise if I sell a Bitcoin tomorrow, doesn't someone, an exchange(?), have to pay me $20,000 in a fiat currency?

Could Wikileaks hack into a Bitcoin exchange and publish all the information about the owners and their trades?

Brendan

 

[BreadKettle]

Coinbase is not anonymous, it is the opposite and engages full KYC and AML process.

There are plenty of anonymous alternatives although they are shutting down or getting shut down as BTC becomes more mainstream.

Is BTC itself anonymous? Not completely.

Monero is.

 

[TheBigShort]

If buy or sell off an exchange, there is a footprint.
But if I send you bitcoin from my private key, from my private wallet to your private wallet, then those transactions are anonymous.
That is my understanding of it.
Anyhow, the anonmynity element I think has been somewhat overplayed. The notion that anyone has any privacy anymore is gone as far as im concerned.
With the exception of what you get up to in the bedroom, everything you do electronically and digitally is recorded. It may not be accessible, yet, but recorded it is.

 

[Leo]

But if I send you bitcoin from my private key, from my private wallet to your private wallet, then those transactions are anonymous.

That's no longer the case and agencies like Europol now have tools that can trace the source of these transactions. The Danes have been early adopters and have already secured convictions for drug trafficking offences.

 

[ant dee]

Leo is correct, because transactions are pseudonymous.

To put it very simply.

A monitoring party can be tracing where the money goes.
At some point they might tie some transaction to an identity, through some exchange, some ATM etc.
Then, based on your model you have a certain probability of how likely the identity is the original party or someone linked to them.

Of course it might not be enough to show to a judge, but now you can look deeper into that identity and do some more traditional investigation work.
Might be first party lost the money on a bitcoin casino and then the winner is simply unconnected.

 

[noproblem]

TheBig Short
"With the exception of what you get up to in the bedroom, everything you do electronically and digitally is recorded".

Many people do business in the bedroom which would be electronically and digitally recorded, especially if they're short of office space, etc.