Buying and Using Bitcoin Anonymously / Without ID
By: Ofir Beigel | Concluding updated: 12/20/22
Looking to buy Bitcoin anonymously? Detest providing your photo ID to different Bitcoin exchanges? In this guide I will attempt to answer all your questions on how to purchase Bitcoins and remain completely anonymous when using information technology.
Buying Bitcoin Anonymously Summary
Despite its reputation, Bitcoin is not completely bearding; With every transaction publicly disclosed on the Blockchain and identity verifications required by exchanges, information technology’s piece of cake to see how your Bitcoins can be traced back to yous.
There are methods to purchase Bitcoin anonymously with cash such as Paxful or Bitcoin ATMs. Furthermore, at that place are places that require minimal identification and non necessarily your truthful identity, like BitQuick.
Lastly, to actually go ‘off the grid’ and become completely anonymous you will require solutions such as Tor and TAILS, money mixers, a VPN provider, and more.
The price for anonymity is usually inconvenient and vice versa. It is up to any user to decide how much he or she is willing to sacrifice one for the other.
That’s how to remain anonymous in a nutshell. If y'all want a deeper explanation of the procedure go along on reading, here’south what I’ll cover:
- Is Bitcoin Anonymous?
- 3 Easy Methods to Buy Bitcoin Anonymously
- Bitcoin ATMs
- Prepaid Menu
- Buying Bitcoin Without Verification / photograph ID
- Why Stay Anonymous?
- How to Use Bitcoin Anonymously? (Basic Guide)
- How to Become Anonymous? (Advanced Guide)
- Anonymizing Your Bitcoins
- Frequently Asked Questions
1. Is Bitcoin Anonymous?
No, it isn’t. While Bitcoin is notwithstanding far more individual than credit cards, it’south even so much less anonymous than cash.
The way Bitcoin works, all Bitcoin transactions are stored in a public ledger chosen the blockchain.
The data stored in each of these transactions includes a bitcoin payment amount, the Bitcoin addresses of the sender, and the Bitcoin address of the recipient.
Can Bitcoins be Traced?
Because every transaction uses the bitcoins from a prior transaction, and the blockchain is public data, every Bitcoin payment has a traceable history that can exist viewed by anyone.
While addresses are 100% traceable they tin can’t be linked to a person or entity. That’s why Bitcoin is frequently chosen pseudonymous or pseudo-bearding.
However, a person’s identity tin be associated with a Bitcoin address through other means. For example when people publish their name together with their Bitcoin address online (among other means).
One time the association has been made, someone with enough conclusion, time, and resources could analyze the blockchain and determine how many bitcoins an individual has, how they receive them, and how they spend them.
To use Bitcoin anonymously, precautions need to be taken to prevent your true identity from beingness associated with your transactions and addresses.
2. 3 Easy Methods to Buy Bitcoin Anonymously
In June 2019, the popular website LocalBitcoins removed its option for in person cash trades.
Method one – Paxful
If you’re looking to purchase Bitcoins anonymously then the easiest fashion would be to buy Bitcoins in greenbacks and in person. Use Paxful to find someone who is willing to sell Bitcoins for cash next to your physical location.
You can use an allonym email accost to sign up to Paxful and the verification id procedure they have is optional. When you employ cash it’s easy to remain untraceable as there is no documentation for the transaction.
Keep in heed that most sellers on Paxful don’t like to practice business with bearding buyers, however, since you’re paying in greenbacks it should be less of an issue.
Method 2 – Bitcoin ATMs
Another mode to purchase Bitcoins anonymously with greenbacks is to become to your nearest Bitcoin ATM and buy Bitcoins from the ATM using cash. If you are in the U.s.a., try out i of Coinflip’s ATMs that offers currently 10% off from the transaction fees if you are using “99BTC” promo code.
Buying Bitcoins via an ATM is probably the best way to become about buying Bitcoins anonymously however not everyone has an ATM next to them.
When asked to enter your Bitcoin address at the ATM just specify that you don’t have one – in near cases, this will just generate a new paper wallet for you and you’re good to go. Later on, you can import the private key from that paper wallet and ship those Bitcoins wherever you similar.
Do I demand an ID for a Bitcoin ATM?
No. Bitcoin ATMs don’t require identification but they are limited in the corporeality of Bitcoins you can buy.
Do Bitcoin ATMs charge a fee?
Yeah. Almost ATMs accuse a fee (usually between 7%-ten%). If the fee isn’t stated explicitly it’due south “hidden” inside the commutation charge per unit.
Method 3 – Prepaid Card
One way to stay anonymous is to use a prepaid credit card you can get at any supermarket or convenience shop. You can and then apply this menu to purchase Bitcoins without the need to supply any course of identification through sellers on LocalBitcoins or Paxful.
three. Buy Bitcoin Without Verification / Photograph ID
The post-obit places allow you lot to buy Bitcoins without the need to verify your identity, however, they exercise not accept cash.
is a Bitcoin broker founded in 2014 and located in the Isle of Human being. With Coincorner, users are able to purchase upwards to €1000 worth of Bitcoin without any verification or ID, for very competitive fees.
Coincorner provides services for several countries around the world, non including the The states.
In addition, CoinCorner offers a mobile app that allows users to carry Bitcoins transactions using their mobile phone.
BitQuick acts as an escrow for Bitcoin transactions via cash deposits at thousands of banks beyond the United states of america.
The idea is uncomplicated – the buyer and seller hold on an amount. The seller deposits the Bitcoins at BitQuick. Once the heir-apparent deposits the cash into the seller’southward account the coins are released.
A mobile phone number is needed for this procedure but no id verification is required. Unlike a photograph ID, a mobile phone number can be hands purchased with an anonymous e-mail via Skype for example.
HodlHodl is a global P2P Bitcoin exchange, that allows users to merchandise directly with each other. The site doesn’t hold user’s funds which allows it to avoid KYC and ID verification processes.
HoldHold locks user funds in multisig escrow which minimizes the possibility of Bitcoin avails theft and reduces trading fourth dimension.
Bisq is an open-source, peer-to-peer software that allows you to buy and sell cryptocurrencies in exchange for national currencies. There’southward no registration required to employ Bisq.
Bisq does not agree any bitcoins. Much like HodlHodl all cryptocurrencies are held in multisignature addresses rather than a Bisq-controlled wallet.
Additional Bisq does not concur any fiat currency (i.east. Dollars, Euros). Fiat is transferred directly from i trader to the other.
four. Why Stay Bearding?
Before nosotros become deep into the ‘how to stay anonymous’, we need to empathize why is it important to go anonymous in the first identify.
The chief reason most often is that y'all don’t want to get hacked or go a potential target. Raising your privacy level will lower your take chances of such actions.
Bitcoin’s blockchain is built on stone-solid cryptography which prevents counterfeiting and other types of fraud, simply the human element in Bitcoin transactions is always the “weakest link.”
Using an online
(eastward.g. Satoshi Nakomoto) will improve your privacy only conduct in mind that a capable investigator tin can identify y'all over a standard net connexion.
Most Bitcoin wallets circulate your real
, which can so be hands associated with your accost(es).
As all Bitcoin transactions are a matter of public tape, any address which becomes associated with your identity reveals iv of import pieces of information:
- How many Bitcoins yous held or concord within that accost
- Exactly when you received those bitcoins
- Who you received those bitcoins from (unless they utilise effective privacy methods)
- The address to which you send those bitcoins (which, as with 3, may identify its owner).
Bitcoin wallets with
features allow y'all to make payments from select addresses (technically called
due south) giving you lot some control over what addresses you betrayal.
Still, the way that near Bitcoin wallets handle
often results in various addresses within the wallet becoming linked.
As a result, one identity-associated address nether your command tin “leak” information about your other, “unknown” addresses.
five. How to Utilise Bitcoin Anonymously? (Basic Guide)
As I already suggested, you can assume as a starting point that all addresses within your Bitcoin wallet tin can be linked to your real identity in ane mode or another.
If yous’ve bought coins from an exchange with identity verification procedures or washed business concern under your real proper noun, this is quite possibly the case.
The expert news is your privacy can be partially or fully recovered from this state.
Improve Bitcoin Privacy
Whenever possible, avoid reusing addresses. Generate a new address for each transaction you lot receive.
While there’southward little point updating a static address associated with your identity, such every bit a Bitcoin tip address linked to a social media contour, simply this is recommended practice in most other situations.
It’s best to use HD wallets if possible that allow a nigh unlimited corporeality of addresses to be linked to a single private fundamental.
Improving Your Online Privacy
If you browse the internet from the same computer or device you lot use for Bitcoin, y'all’ll definitely want to upgrade your privacy and security features.
The information site, Prism-Suspension, provides a variety of recommendations for different operating systems and devices.
Another thing you can do is use an end-to-end encrypted email service such every bit Mailfence, which protects your information from third parties, as well as governments.
Recall – when selecting privacy / security / encryption software, mature and open-source solutions are usually preferable.
Avoid SPV and Hosted Wallets
SPV wallets practise not store the blockchain locally. Instead, they query a single SPV server for the transactions that involve the addresses in your wallet.
While this functionality is far more efficient and fast than parsing the blockchain locally, the trade-off is that every Bitcoin address you lot own is submitted to the SPV server.
Almost all SPV wallets (too known every bit sparse or light wallets) leak which addresses you ain to whatever SPV server they connect to.
Some SPV wallets have the capability of using flower filters to assist conceal which addresses you own by requesting extra transactions that don’t involve your wallet.
Electrum, for example, doesn’t use flower filters at all, then whatever server you connect to knows every accost that you ain.
Some other corking privacy-focused wallet yous can use is
, an open-source wallet which enables privacy on any asset it holds. The wallet applies anonymity techniques like RingCT and StealthAddress (similar to Monero) – to all avails it supports. This includes Bitcoin, Ether, USDT and hundreds of other cryptocurrencies.
Hosted clients (wallets managed by a tertiary party like Coinbase) are even worse in terms of anonymity. All of your private and public keys reside on 3rd party servers, so it is niggling for the operator to know which Bitcoin addresses you own.
Additionally, any other information you’ve submitted to the service is associated with your Bitcoin addresses and can be easily accessed past the service’s operators.
These types of wallets brand it easy for an SPV server operator or service ambassador to not simply know which Bitcoin addresses y'all own but also associate them with your IP address.
The operator could potentially leak the information, lose it, or expose information technology if subpoenaed or NSL’d to provide logs to law enforcement or authorities agencies.
One of the fundamentals of Bitcoin is not having to trust any single party. In terms of anonymity, information technology’due south best to utilize a full Bitcoin client like Bitcoin-Qt or Arsenal and shop the entire blockchain locally.
Human-memorizable passwords tend to be weak. This problem and its solution are best demonstrated by the post-obit XKCD webcomic:
Using your own variant on “correct horse battery staple” for multiple accounts is also a bad thought, from a security and privacy perspective.
A single compromised business relationship could leak all the passwords to your email, Bitcoin exchange, and other sensitive accounts. Trying to memorize a unlike password for tens or fifty-fifty hundreds of accounts is similarly a recipe for disaster.
The solution is to apply a adept, random-discussion password along with a password manager. Password managers generate strong, lengthy, and random passwords which you don’t need to memorize.
The program stores them in an encrypted format. Your passwords get attainable only when you enter your single master countersign into the manager (which should be memorized and never written downward).
6. How to Get Anonymous ? (Advanced Guide)
Online security is ofttimes characterized every bit a merchandise-off between effectiveness and convenience. Information technology’southward upwards to you to cull on which end of this calibration you wish to be.
In this affiliate, I’ll review methods that require more effort but brand your steps much less traceable.
Disguising Your IP Address with Tor
The commencement step in becoming anonymous is using Tor, a powerful anonymity tool.
Visit TorProject.org to download and install Tor (short for The Onion Router ). In one case activated, Tor opens as a separate, Firefox-based internet browser which disguises your IP address.
Tor works by routing your connection through several other participating computers. The ultimate effect is that whichever website y'all admission will meet your request as coming from an entirely dissever automobile, usually in a different land or land.
Although it masks the IP address and certain potentially identifying browser characteristics, Tor is by no means a complete privacy solution.
Using your real name, accessing your regular email, or signing into social media via Tor will have exactly the same de-anonymizing consequence as doing so through a regular browser.
For a more private electronic mail address, create a defended darknet electronic mail account for Tor usage, such as a Mail2Tor account.
In one case y'all’re browsing through Tor, you may besides access the darknet to research cyberspace anonymity further without undue concern over prying eyes.
There’due south a known set on past which malicious leave nodes in the Tor network serve a fake version of LocalBitcoins which phishes log-in details.
Running Bitcoin through Tor
Once you lot feel familiar enough with Tor, it’s fourth dimension to brand your Bitcoin addresses bearding. To practise that yous need your wallet to connect through Tor.
One solution tin can be using Bitcoin core, which every bit of release 0.12 automatically connects through Tor if information technology detects its presence.
To strength this behavior, follow these instructions on Bitcoin’s GitHub. Here are some further tips on Reddit. Nigh other wallets are also able to connect through Tor, consult their documentation to discover how.
Consider installing a new wallet which only ever connects through Tor. To do that, disable your net connectedness and configure the new wallet to run exclusively via Tor before launching it. Yous may so re-enable your internet connection and allow the wallet to sync.
If using a full wallet, copying an existing blocks folder (ensure that yous don’t also copy your wallet.dat folder) to the “Tor wallet’s” information directory will greatly speed the syncing process.
Straight transferring bitcoins from your onetime wallet to this new 1 will somewhat obscure the ownership of those coins. Yet, in that location are far more sophisticated methods of transferal (covered later) which will exist more than effective at disguising this catamenia of funds.
Consider Joining a Virtual Private Network (VPN)
Equally mentioned, Tor does non guarantee 100% privacy. An adversary who owns both the first and terminal machines you lot connect through volition come across your IP as well as the sites you admission.
If you’re willing to pay for a lilliputian extra peace of mind, consider a VPN service. Instead of accessing the Internet – or Tor – directly, your connection will be routed through the VPN’s servers.
A VPN has somewhat like benefits to Tor; information technology obscures your IP address. In fact, nearly VPNs permit you to spoof the nationality of your IP address (which tin be helpful for accessing location-specific data).
VPNs too provide security benefits. They act to screen your device from malware via firewalls and proxies.
Different certain sites which cake access from known Tor routes, VPNs usually afford unlimited access and much higher bandwidth than the Tor network.
It’s entirely possible to access Tor through a VPN for another layer of obfuscation.
Leaving traces of your activity on your hard drive or removable media represents another manner in which anonymity may be compromised. Disk encryption software allows you to encrypt a file, folder, or unabridged drive such that it can no longer be accessed without a countersign.
Encrypting your Bitcoin wallet file and any sensitive information stored on your figurer is adept exercise. With decent disk encryption software, you tin can create multiple, secure backups of your most important files and data and disperse them on USB retentiveness sticks and the like.
Wikipedia offers a proficient comparison of the available deejay encryption software options. Exercise not rely on the Windows BitLocker plan; unlike open source alternatives, it is not provably secure.
If you lot lose or forget your encryption password, you’ll lose access to whatsoever encrypted files. No recovery!
The Amnesic Incognito Live System (TAILS)
Finally, if you’re serious near your privacy, you’ll want to bring all the in a higher place methods together in a secure operating surroundings. Unfortunately, standard operating systems practice not prioritize privacy.
Windows, for example, is known in its efforts to monitor users. It, therefore, makes sense to kicking into a secure, privacy-respecting operating system before attempting to send Bitcoin anonymously.
The best possible option here is TAILS, a variant of the Debian-based Linux operating system, which past design leaves no trails.
Don’t worry if you lot’ve never used Linux before, TAILS features an interface which volition be familiar to any Windows or Mac user. TAILS can even mimic the advent of Windows and then that casual onlookers won’t notice anything unusual about your computer usage.
TAILS packs a host of privacy, security, and encryption features into a package small enough to fit on a portable USB drive. It even includes KeePassX (a password manager) and the Electrum calorie-free Bitcoin wallet as standard!
To boot to Tails on start-up, the USB bulldoze must be formatted as bootable via a program like Universal USB Installer or Rufus.
TAILS must so be downloaded and installed on the drive. Note that installing and keeping Tails updated will crave 2 such USB devices.
If you want to get started with TAILS you can utilise this uncomplicated online tutorial.
Altering your Bios setup to booting from TAILS rather than the hard bulldoze allows you lot to use untrusted computers and networks deeply.
This ways you may anonymously send Bitcoin from even a public, monitored computer, such equally those in a library or internet café, without leaving any traces of your identity or activeness.
While TAILS does hands defeat any software-based data logging, continue in mind that Tails tin can’t protect against hardware keyloggers or hardware screen capture. Fortunately, TAILS contains a virtual keyboard and other mouse-driven text entry applications.
For password entry on untrusted devices, employing a combination of onscreen text-entry and spam-text logging countermeasures is recommended.
TAILS stores no information regarding the software yous employ, sites you visit (via its built-in Tor browser), or anything else. However, TAILS does allow you to create an encrypted, persistent book within your USB stick.
Whatever data placed in the persistent volume will be maintained between sessions. It’south advised to store your password manager data file within this volume.
7. Anonymizing Your Bitcoins
If you lot have bitcoins that have already been in some fashion tainted with a link that could place you, it’s possible to break that link and effectively anonymize the coins again.
If done correctly, hereafter transactions from that signal forrard won’t be connected to y'all anymore.
Tumbling Coins through Mixers
For anonymizing purposes, there are mixers (also known every bit tumblers). The bones concept is that you send the coins you want to have anonymized to the mixer, which in plow sends dorsum the same amount minus a fee to a new address you provide.
The coins you lot receive back are from a large pool maintained past the mixing service and should ideally not have any connection to your original coins.
The major flaw of this concept is its centralized nature. You take to trust the mixing service to requite back your coins and additionally, you have to trust that they do not keep whatever records of the performed mixing transactions.
Especially the latter point is tricky since you can never know for certain what they are doing with the information. If the mixer really doesn’t keep whatever transaction records, they have no way to prove it.
On the other hand, if they don’t or are fifty-fifty forced to hand over their data, you take no manner to know.
For privacy purposes, only employ darknet mixers such as BitMixer.io: bitmixer2whesjgj.onion or Grams’ Helix: grams7enufi7jmdl.onion/helix/. BitMixer works pretty fast, mixing through Helix can have a few hours.
A trustless, decentralized method of mixing tin be found in JoinMarket; an implementation of a privacy-improving technique outset proposed by core developer, Greg Maxwell.
This infographic provides a gentle introduction to the workings of JoinMarket. Although a fairly simple concept, at the present state of evolution, JoinMarket represents a more than complicated undertaking than sending coins through a mixing site:
If yous accept a good understanding of Bitcoin and you’re prepared for a more easily-on method, JoinMarket is highly recommended.
Apart from giving you back control over the mixing process, it also lowers your risk and transaction fee. JoinMarket even lets you earn a niggling coin by helping others mix their transactions.
Another mode to implement coin shuffling easily is to utilise Wasabi wallet. An open source wallet that implements trustless money shuffling with mathematically provable anonymity.
Obscuring the Trail through Altcoin Shifting
Why finish at mixing between Bitcoin addresses? Mixing between Bitcoins and privacy-axial altcoins provides some other layer of obscurity.
This method requires peradventure a little less trust than using a centralized mixing service. The all-time altcoin to use for this purpose is probably Monero (XMR).
This short guide covers buying Monero with Bitcoin (tl;dr you lot tin can employ Binance). To anonymize your bitcoins, simply catechumen them to XMR, forward them to a new Monero accost nether your command, and so catechumen them back to new, anonymous BTC.
Another case of a site for converting between Bitcoin and Monero is XMR.to. Remember to access it via Tor and don’t worry about sign-up.
9. Determination – Anonymity comes with a price
To sum things up, it’s up to yous to decide how much anonymity y'all actually demand online. The more bearding you’ll want to be, the more effort you’ll need in lodge to navigate around the web.
This guide brought yous the main tools and techniques at your disposal so you can mix and match whichever works best for you.
If yous’re just looking to buy a few coins without being traced, but utilise greenbacks – information technology will solve most of the problems. If you are simply concerned with providing your ID, well, there are ways to bypass that also.
Nevertheless, if you want to get real serious about using Bitcoin anonymously around the web, then at that place’s no other way than going through the trouble of condign truly and fully anonymous…
If yous’ve had whatsoever experience with buying Bitcoins anonymously I would beloved to hear it in the comment section below – don’t worry, you can utilise an alias 🙂