Reused change addresses not only allow tracing what you're doing with the change but also tracing what you're doing with the rest of your BTC. Let's say I'm a merchant and you pay me some BTC; I can look at the change address and see other deposits. I can follow the transactions of these deposits and see that you also sent BTC to other (known or unknown) addresses; which could be exchanges (authorities can call them and ask 'who is the human behind address X'), stores or friends of yours that I now know you have some sort of connection to.
True, but doesn't this answer on why you shouldn't keep change at all? As said by Leo above, whenever you're going to have a decent change left over from a transaction, send them to ChipMixer instead. Or, if you're thinking of buying in bulk, make your purchase and send the rest to ChipMixer.
What I said is: If you have change in x outputs, which are essentially linked from your previous transactions, it doesn't matter that much to broadcast 1 transaction where you spend them all, or x transactions where you spend 1 in each.
Oh, the issue with this is that I assumed the change doesn't all land in the same address. I'm not sure if there's a standard way; as far as I know, change is handled a bit differently from one wallet to another.
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The biggest downside of this method is that your account may be frozen after you made a deposit and you will no longer be able to withdraw your funds or consolidate them unless by sacrificing your privacy by providing your real identity. If you still consider exchanges a means to merge your small inputs, a simpler solution would be using a nice bitcoin-only gambling website like bustadice where, as you said, you need nothing but an email address to sign up and where it is highly unlikely that you will be asked for documents. If you like, you can gamble with part of the funds to further obscure the link between your initial amount and your withdrawal amount.
Well, those gambling sites could also close your account, though. So I see no benefit there; the moment you use a centralized party, there is going to be some risk involved.
Also, and since I do like the service you can use Bitrefill and buy gift cards if it's available where you are located.
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I really like this idea; these gift cards come in handy anyway from time to time; even as a small birthday gift or simply to purchase something on Amazon. I've only used the service through Lightning so far and didn't know you can also create an account and top it up little by little.
So you just got tons of 0.001BTC chips from ChipMixer and used them in full when paying something? Wouldn't that make for pretty large (and expensive) transactions? Or would you create and withdraw appropriately sized chips / UTXOs on the spot?
Let's say I deposited 0.1 BTC to ChipMixer. I then wanted to pay for something which was 0.0207 BTC. I would withdraw a 0.016, 0.004, and 0.001 chip, pay the merchant 0.021 BTC (not minding that I just overspent by 50 cents or so) and leave the other 0.079 BTC on ChipMixer as a voucher until I next needed it. No change created. But as I said before, this isn't really economical anymore since the lost 50 cents in this example is now ~$10.
This implies you fully entrust those remaining 0.079 BTC to CM though; not that I'd ever doubt them, but in general I try to minimize such trust. It could be that there is a problem with the website and I can't access it right when I need to or similar sorts of issues, but otherwise it seems like a viable option if the Bitcoin price was a bit lower or the smallest chip size was reduced.
I tried to bring this idea up but wasn't sure how to correctly phrase it. Sending multiple outputs to a single CM mix, individually, will keep them completely unlinked, right?
Well, a single ChipMixer session provides a single deposit address, so no, it would link all the outputs. The way to do it is to deposit any UTXOs you don't mind being linked in a single session, withdraw a voucher for the total amount of your deposit, and then destroy that session. Repeat with another sessions with another set of UTXOs and withdraw another voucher. Repeat as many times as necessary - you can do as little as one deposit per session if you want (bearing in mind the minimum deposit limits). Once you have multiple vouchers, you can open yet another new session and combine all the vouchers together, and then make a single large withdrawal.
Yup, makes sense; so basically restore the session for each output as long as the output's size is large enough; link smaller outputs by submitting them during one session to reach the minimum size.. You'll maybe pay a bit more though, since every time you create a new session and deposit some coins, they'll be 'truncated' to 0.001 amounts, right?
Drat! I've been doxxed! Time to abandon this account I guess.
It's been nice knowing you!