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Bitcoin Perfectly Anonymous — Until You Spend It
jfruh writes "One of the great attractions of Bitcoin as a currency is that it's completely secure and anonymous. But according to researchers (PDF) from UC San Diego and George Mason University, that anonymity starts to vanish the minute you exchange bitcoin for real-world items or conventional currencies. The researchers tracked transactions across the Bitcoin ecosystem and found points where it would be easy for a government with subpeona power to find the identity of a Bitcoin user. They also concluded that the currency wasn't especially attractive for money-laundering purposes."
Graph theory explains many things.
Check it out, https://bitcointalk.org/index.php?topic=279249.0
1. If you mine them with a pool, and connect your wallet client to the net via a proxy or VPN, they may as well be anonymous.
2. There are bitcoin laundering / "tumbling" services available.
"One of the great attractions of Bitcoin as a currency is that it's completely secure and anonymous."
No it isn't, and no it isn't.
Just wait until it is mandatory for vendors to scan currency serial numbers at every transaction.
The Moore-Murphy Law: The number of things that will go wrong will double every 2 years.
... for purchases. The gov't will see my garage full of Porsches and Ferraris and the yacht at the dock. What I need to do is to disconnect my means of income from expenditures.
No problem with taxes. I'll pay them. But I don't need the IRS snooping on my investments and calling their buddies with stock tips so they can front run me.
I used to work for an outfit that bid (but lost) a major IT contract to support IRS operations. The story was that they bid way below their cost. But they figured that getting their hands on taxpayer data and using it for their own purposes would more then make up for their loss. To this day I wonder what the contract winner is doing.
I wonder how contractors like Booz Alan Hamilton bid NSA contracts.
Have gnu, will travel.
I'm unsure why people think Bitcoin is any kind of anonymous in the first place. Every transaction must be widely published for processing (in theory, ever miner can see every transaction). The entire money flow, every transaction worldwide, is known. Does anyone still think the NSA doesn't know every bitcoin transaction ever processed? Does anyone still think an IP address (with timestamp) is anonymous in any way?
The only anonymous in Bitcoin transaction is one where you hand someone the "wallet". Transferring your secrets, especially by hand, is as anonymous as handing cash to someone, but that's not really the intended model, or a particularly useful one.
Socialism: a lie told by totalitarians and believed by fools.
Bitcoin is pseudonymous. Sure, the transaction history is public, but in regard to personally identifying information it only contains public keys, hashes of public keys, and signatures made using the corresponding private keys. Keys can be generated at will—one person can have a thousand different keys, or several people can share one (provided they trust each other).
Naturally, it's up to the user to avoid linking their keys to each other or to their real-world identity. You can avoid linking your IP address easily enough by connecting to the network via Tor or I2P. Avoiding a link to your real-world name and address is much harder when you're ordering physical goods or services.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat