Topic: Retailers accepting Bitcoins may expose sensitive info via ledger (Read 1157 times)

Simple issue and potentially big problem, which I think was not taken into consideration by any of the merchants looking into adoption of Bitcoin mediated payments, is the availability of company sales records in the public domain.

I am talking about the fact that detailed Bitcoin transactions records made by the retailer can be seen in the public ledger by anyone. The competitor can them simply observe the dynamics of sales and thus know what is going on in the company.

At this point in time we of course know that those using Bitcoins for purchases may not be an accurate representation of general population of consumers (we like sheets for instance...). However, the more people are using Bitcoins to purchase goods and services from a vendor, the more accurate such (insider) information will become.

Not only that, but lets take Overstock.com as an example of even deeper potential exposure of this company's internal affairs. Overstock.com CEO stated that he also wants to transact with suppliers and pay employees via Bitcoins (to cut transaction costs). It means that once it starts happening, the world may know WHO exactly Overstock.com's suppliers and employees are, simply by looking at the ledger.

Now, to take this a step further, since suppliers are typically specializing in a narrow set of merchandise, one then can probably deduct what sells better on Overstock.com. Not only this, but this information can be followed in real time. Availability of such information is a "ticket" to stealing business and building a better one, without extra expenses of doing market research.

What are the experts' thoughts on this? Is this a potential issue? Are we witnessing Overstock.com (shares down over 1/4 in just two days) and TigerDirect.com in the process of "digging their own graves"?

Edit based on initial comments: This post is NOT a query about what one needs to do to secure sensitive financial transactions form public view for legitamate reasons. Having this task presented, I am sure a lot of people around here will jump in answering. Please do not do this. The best answer that all of you will eventually arrive to, is the use of one or another incarnation of tumblers (bitcoin-mixing services), which by the way in turn raises the whole load of regulatory issues (licenses for tumblers...?)

The issue raised here is the fact that when new merchants are approached with Bitcoin adoption, they MUST BE presented with the need to secure their business related transactions from direct public viewing (if they care). Are you sure that local pizza shop owner even thought about this aspect at all? She/he of course may not care, but big retailers like Overstock.com MUST think about this and they MUST have a solution to this. Are you sure that this already done routinely?

Sorry, I got an off-topic question here.

As far as I know, a HD wallet will generate your private keys using a seed, and then from the private keys. we get the public keys and bitcoin addresses.
Of course, people won't get the private keys or the seed from the addresses. But, solely by looking at those bitcoin addresses, can someone find out that they all derived from the same seed, and thus those addresses are very likely belonged to the same person?

have been working on HD wallets