Topic: Saying hi (Read 755 times)

Welcome.

Point taken
Out of curiosity, how did you find it? I was able to close one leak, but I wonder if we found the same one.

DannyHamilton, I agree that entry and exit of the Bitcoin network are the most crucial parts for staying anonymous, but I believe that they are hard to secure. I am trying to find out if there is a way to make those events unlinkable, as you said. Of course, one must trust the mixing entity to not be with the government and not keep logs. However, that confidence could be increased by passing the funds through many mixing services, and it is my theory that unless all of them are cooperating with the government or careless, the link cannot be established. An even stronger guarantee of anonymity would be that even if the link is found, no one could be sure that the link actually points to your series of transactions. But if the whole world is conspiring against you, nothing can be done indeed.

Ok, so we are starting by assuming that Mr.X has a bunch of bitcoin that he has acquired in such a way that the entity with significant resources CAN identify his ownership of the bitcoins (working on the assumption that they can acquire from MtGox the ownership of the accounts that Mr. X used). And we are ending with the assumption that the entity with significant resources CAN identify the Organization Y's ownership of the address that will be receiving the coins.

At this point you've already eliminated the two best opportunities to maintain anonymity.  It seems that your question isn't "How anonymous Bitcoin is or can be against someone with a large amount of resources?", but rather "If my coins aren't anonymous and the intended receiver of my coins isn't anonymous, is it possible for me to engage in a particular sequence of transactions that will prevent a determined well funded entity from figuring out that the coins I owned were the funding behind the coins that Organization Y received?"

Given the current state of forensic accounting and the relative youth of bitcoin, I wouldn't count on it.  Let's assume for a moment that someone offers up a mixing service that is somehow popular enough to acquire enough usage to obscure the movement of $1 million worth of BTC.  Furthermore, lets assume that this mixing service has demonstrated that their methods are sufficient to counteract all available forensic accounting methods.  Even if such a mixing service existed (I doubt it does), how could you be certain that the mixing service wasn't being run by the well funded entity that you are trying to hide from?  How can you be sure that they aren't keeping logs or being forced to cooperate with the entity you are trying to hide from?

It seems to me the only way to be 100% certain that a transaction can't be traced back to you is to ensure that your acquisition of the bitcoins used in the transaction can't be traced to you in the first place, and be certain that the receiver doesn't know who you are.  (If the receiver of the coins can identify you they can be interrogated by the entity attempting to identify you)  Once you give up your anonymity to either the supplier of your bitcoin or the receiver of your bitcoin, you should assume that a determined well funded entity can trace the transaction back to you.

There are so much more ways to find out about people than just looking at the block chain, Olivier. I wouldn't risk it.

That situation is interesting indeed, but that is not quite the one I was looking at. Say Mr. X, who is very rich, wants to fund (presumably illegal) organization Y. Then Mr. X can, over a few months or so, accumulate some Bitcoins by trading them through Mt. Gox for USD or through other means using different aliases and addresses if need be. Mr. X then sends these coins through a mixer (let's say the mixer doesn't keep logs more than 1 week) that sends the accumulated amount to a new address belonging to Mr. X. He then uses that address to simply send the amount to the known address of organization Y.

Once a government has seen the money arrive at the address of organization Y, is there a way for them to find out whom Mr. X is? Even if it is not the case, can the government look at the blockchain and figure out what were the original addresses Mr. X used to collect the bitcoins even though they were mixed? Is there such a thing as a mixing service that can guarantee that, from a theoretical point of view?

Well, this makes for a fun scenario.  To discuss it we'll have to make some assumptions.

Lets start by assuming that the paramilitary organization is not covert.  The government knows of its existence and its actions.  Furthermore, lets assume that the paramilitary organization has publicly published a bitcoin address for receiving bitcoin donations towards its activities. This means that by monitoring the paramilitary organization's address they can determine exactly how much bitcoin the organization is receiving and from which addresses they are receiving that bitcoin.

This means that if we're going to donate to the organization, we need to ensure that the government is not able to connect our identity to the address from which we send.

Since the total daily transaction volume of bitcoin right now is about 2.85 million bitcoin, it is probably going to be difficult to acquire millions of dollars worth of bitcoin anonymously.

Lets assume though that through anonymous communication methods (TOR Chat?) we happen to find someone who owns 91,076.92 BTC that they want to cash out. we make arrangements for a dead drop of $1 million in cash that we've somehow anonymously acquired and stored, and they transfer the coins to an address that we've created offline.

So, assuming that we managed to remain anonymous in our acquisition of the $1 million in cash, and in our communications, there is now no way to identify who owns the 91,076.92 bitcoin.

We now must connect a client to the network in such a way that the government cannot trace our connection back to our ip address.  This means we will need either a trusted or hacked chain of proxies.  If TOR is as good as obscuring our ip as it claims to be, then we can use TOR for our chain of proxies.  We use the connected client to sign a transaction transferring the 91076.92 BTC to the paramilitary organization's bitcoin address and then shutdown our client and TOR.  We then destroy the hard drive that was used for the transaction as will as any other copy of the address or private key that we used for our transfer.

At this point, the government can probably tie the donation back to the person who has our $1 million, but they are unable to identify us as the "middle-man" who enabled the transfer.  It is up to the person with $1 million to convince the government that they are not responsible for the donation to the paramilitary organization. Even if they do manage to convince the government that they didn't know where the BTC was going, the government probably won't look very kindly on their decision to engage in a completely anonymous $1 million transaction.

You can see from this description one of the biggest issues that you have to overcome in moving such a large volume of bitcoin anonymously.  You need to find someone who is willing to supply you with bitcoin in a completely anonymous manner.  This either means finding a single person who is willing to do that, or putting a LOT of work into finding many people who each are willing to supply a smaller amount. Once you find these people, they either need to transfer the bitcoin trusting that you'll drop the cash at the dead drop location, or you need to provide them with the drop location trusting that they will send the bitcoin once they have the cash.

Welcome fellow peer. 

That is indeed the case I am interested in. I really don't care if the government can find out if Mr. X is buying a sexual toy, but rather if they can find out who is funding paramilitary organization Y with millions of dollars even though I would expect such a person to use the best privacy methods. Specifically, I am looking into graph analysis and what it enables us to know even when used with strong privacy measures.

Great answer.  And welcome Murphant!

Average use by a typical user would result in very little anonymity in the face of an concentrated effort by an entity with access to resources of the size of a world power government.

On the other hand, with the appropriate knowledge, precautions, and effort bitcoin can provide the tools necessary for near complete anonymity against an entity regardless of their resources.

Perhaps if you offer a hypothetical scenario as an example, we could demonstrate both how an average user might accidentally reveal their identity, as well as how a careful user could maintain their anonymity.

In general, I'd say there are 3 areas of concern.

• Acquiring bitcoin
• Storing bitcoin
• Spending/disbursing bitcoin

Hello everyone

I have been browsing the forum for a few weeks and I decided to jump in and create an account.

While I do have Bitcoin addresses, I do not currently actively trade BTC so their balance is very low. I have more of a theoretical interest in Bitcoin especially in its cryptography. I am also interested in other crypto-currencies as well as e-cash in general.

I have already read quite a bit about Bitcoin, and produced an introduction to Bitcoin's cryptography talk that I will link to once it's edited.

I am currently interested in finding out just how anonymous Bitcoin is or can be against someone with a large amount of ressources (i.e. government, etc.), as well as the implications of such anonymity.

You can sometimes find me on irc in #bitcoin.