For many, the privacy offered by bitcoin and other cryptocurrencies was one of the main reasons to invest in the first place. Holding assets not directly associated with one's real-life identity allows cryptocurrency users to experience financial independence from government authority.
However, governments are looking for new ways to regulate and tax this emerging market of wealth and assets. bitcoin exchanges have implemented tight Know-Your-Customer (KYC) protocols, meaning that if you don't take steps to cover your tracks, all of your transactions are traceable right from your very first bitcoin purchase. At Bitcoin Laundry, we want to help you protect your privacy every step of the way. We offer you these tips to help keep your anonymity from the very beginning.
Trade with cash
Using a peer-to-peer network like Localbitcoins to buy bitcoins with cash is one of the few truly private ways to acquire bitcoins without compromising your identity. Meeting a stranger to exchange cash can be risky, so make sure you choose a bitcoin seller with a good trust rating and take steps to protect your physical safety-- meet in public, don't give away identifying information, etc. If you find a reliable source, you can skip the online search and contact them directly the next time you want to make a purchase.
Not all bitcoin ATMs require ID or registration. For the best privacy, you'll need to find one that accepts cash and prints a receipt. When you purchase bitcoin from an ATM, you’ll usually be asked to provide a bitcoin wallet address. To stay truly private, choose instead to print a paper receipt, with a unique bitcoin address for you. From there you can move the bitcoin to your own wallet or address of your choosing. You can use CoinATMRadar to find a bitcoin ATM near you.
Buy with crypto
If you want to buy bitcoin and you already have another cryptocurrency, staying anonymous is much easier. Many crypto-to-crypto exchanges don't require verification for exchanging small amounts.
These days, it's getting harder to buy bitcoin without handing over your person information as part of the process, especially in the US. Buying with cash in person or from an ATM are usually the best options. Fortunately, once you have your bitcoin, anonymously exchanging it for a different cryptocurrency is much simpler. At Bitcoin Laundry, we want to make sure your identity remains secure at every stage of the process, so remember: even when you have purchased your bitcoins anonymously, mixing your bitcoin remains an important step to protect your privacy for each transaction!