Is it true that when you buy bitcoin you are anonymous and cannot be traced?
The growth of Bitcoin and the cryptocurrency itself made the country of El Salvador approved Bitcoin as legal tender. Perhaps the rise in cryptocurrency use in general is due to its reputation for being an anonymous and untraceable payment method, but how secret is Bitcoin really?
Regardless of which apps buy bitcoin and other cryptocurrencies you use; it seems that transactions with cryptocurrencies reveal more information about you than you think.
One of the problems with anonymity when buying with bitcoin is that cryptocurrency wallets are not completely anonymous. Although cryptocurrency wallets do not store your name, they give you an alias to identify you and by identifying you with a code, your transactions can be tracked.
Bitcoin and other cryptocurrency wallets change your real name into a code with a string of numbers and letters. Since the cryptocurrency wallet addresses are encrypted with a fake name, people think they can’t be traced. However, your wallet address can be traced back quite easily.
To exchange a certain amount of Euros for Bitcoin or another cryptocurrency, you need to verify your identity with the crypto wallet you are using. In general, Bitcoin wallets ask you for a copy of your ID, passport, or driver’s license to verify your account. In fact, the 5 best crypto wallets for Android require you to verify your identity.
Cryptocurrency wallets request your identity information because governments require it, possibly to prevent money laundering. Either way, the Bitcoin wallet you use contains important information about your identity.
Governments and authorities can find out if you’ve bought bitcoin, how much you’ve bought and when just by asking the company which wallet you’re using.
1- How can you get bitcoins anonymously?
Hiding the history of bitcoins to keep them anonymous is very technical and expensive. To keep bitcoins hidden, a special protocol must be configured to hide the origin of a bitcoin transfer or have someone act as an intermediary when buying bitcoins. After hiding the origin of the bitcoins, they must constantly move between different wallets.
Another way to get bitcoin anonymously is to mine it yourself, of course this is an expensive practice and it is profitable only in countries where the price of electricity is low.
To get bitcoin anonymously, you can also buy this cryptocurrency with cash using a bitcoin ATM. Although you have to keep in mind that these ATMs charge a commission of around 7%, so this requires that you carry a lot of cash to buy Bitcoin.
There are some alternatives to Bitcoin that although they are not completely anonymous, they have a better system for hiding traces of transactions with them. Monero, Dash, and Zcash are some of the cryptocurrencies that hide their wallet address better and are therefore more difficult to trace.
Conclusion: Bitcoin is not anonymous and there is no fully cryptocurrency, anyway you should try to protect your digital assets because there are thousands of apps on Android that want to steal your crypto. We also recommend you to know the most secure crypto wallet so that your bitcoins and cryptocurrencies are safe.