How to keep your Bitcoin private: the basics

Many people think Bitcoin is anonymous. It is not. It is pseudonymous, which means the ledger shows a nickname (an address) instead of your name. If your name gets attached to that nickname, everything it has ever done becomes visible. This guide shows simple habits that keep your name away from your coins.

What the public ledger shows

Every Bitcoin payment is written on a public ledger that anyone can search. For each payment, anyone can see:

• the sending address and the receiving address,
• the amount,
• the time.

Companies and researchers combine this with other clues, such as exchange records, website data and your own posts, to work out who owns which addresses.

The seven habits

1. Do not reuse addresses

Every time you receive money, use a new address. Good wallets do this for you. If you give out the same address twice, both payments are linked to you, and people can see your whole balance.

2. Be careful where your coins come from

Coins bought on a KYC exchange are linked to your name. See how to buy crypto without KYC. Try not to mix coins from different sources in one payment, because a payment that uses coins from two places proves they belong to the same person.

3. Keep different identities in different wallets

Use one wallet for savings and another for everyday use. Do not pay from your "private" wallet to an account that knows your name.

4. Never post an address in public

A wallet address in a forum post, a profile or a donation page ties it to that name for ever. Use a new address for each payer.

5. Understand "change"

When you pay, your wallet may send the leftover back to you at a change address. Wallets that let you choose which coins to spend (called coin control) give you better control over what gets linked. If your wallet offers this, learn the basics before you move large amounts.

6. Protect your internet address

When you send a transaction, your internet address can be seen by the network. Use a VPN or Tor. See how to use a VPN on GrapheneOS.

7. Keep your own records offline

Do not name wallet labels or notes with real names. Keep your seed phrase offline. See how to use PGP to protect your files if you keep backups in the cloud.

Lightning: a more private way to pay small amounts

Lightning is a layer on top of Bitcoin for fast, cheap payments. Individual Lightning payments are not written on the public ledger, so strangers cannot read them. It is better for privacy than ordinary Bitcoin payments, but it is not perfect. The people running the channels can see some information, and you must manage your channels.

When to use Monero instead

If privacy matters most, Monero hides sender, receiver and amount by default. You can buy Bitcoin privately, then swap it for Monero. See how to swap crypto with Fujn Swap.

What about "mixing"?

Some tools mix coins from many people together so they are harder to follow. These tools are more advanced. Some are controversial, and some exchanges treat mixed coins with suspicion. In some countries, using certain mixing services is illegal or has led to legal action against the people who run them. Learn the rules where you live before you try one.

A simple checklist

• [ ] A new address for every payment I receive.
• [ ] I did not post my addresses in public.
• [ ] I keep savings and daily wallets apart.
• [ ] I use a VPN or Tor when I send.
• [ ] My seed phrase is written down and kept offline.
• [ ] I know the tax and legal rules where I live.

If something goes wrong

• I reused an address: stop using it for new payments. Move on to fresh addresses. The old link cannot be erased.
• My name is linked to a wallet: treat that wallet as public. Open a new wallet for private use and do not link them.