Tumbling Bitcoins: A Guide Through the Rinse Cycle

rphk

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Quote from: Posternut on July 21, 2016, 08:07:12 PM

When it comes to Bitcoin, privacy is a big deal to a lot of people, and it might be because they are partaking in a type of exchange that their government doesn’t agree with. It also might be because certain Bitcoin-related businesses may blacklist you due to using gambling sites. This article is meant to give a few pointers on the various techniques of tumbling Bitcoin by sending satoshis through the laundry.

https://news.bitcoin.com/tumbling-bitcoins-guide-rinse-cycle/

yes i agree , few people like privacy holding bitcoin , some countries still bitcoin is not approved and legalized , those countries will not allow betting , gambling etc , and also tax related issues. citizens has to pay taxes.

pooya87

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Quote from: Cuidler on July 23, 2016, 06:56:27 PM

Quote from: European Central Bank on July 23, 2016, 04:56:28 PM

what's the deal with using an exchange? that's what i do, not that i'm buying child porn or nothing. coins go into one address. they come out of a totally separate one. fees are minimal too.

So the exchange knows how many coins you have and where you spending the coins. Well at least nobody else you sending the coins to know this info, but still it might allows the exchange to use your spending habits to deliver targeted advertisement to you. I would be not surprised if something like google is doing would not be used by the exchanges as well in future to profit a bit from their customer habits, I mean delivering the targeted advertisement to them - afterall information equeals money.

for most of us, we only care about that "everybody else" that we don't want to know our private affairs. i mean any average joe can open up a block explorer and follow our bitcoin address with the transactions and see where we spend our BTC and from where we receive it, and many find that invasive of their privacy.

Cuidler

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Quote from: European Central Bank on July 23, 2016, 04:56:28 PM

what's the deal with using an exchange? that's what i do, not that i'm buying child porn or nothing. coins go into one address. they come out of a totally separate one. fees are minimal too.

So the exchange knows how many coins you have and where you spending the coins. Well at least nobody else you sending the coins to know this info, but still it might allows the exchange to use your spending habits to deliver targeted advertisement to you. I would be not surprised if something like google is doing would not be used by the exchanges as well in future to profit a bit from their customer habits, I mean delivering the targeted advertisement to them - afterall information equeals money.

The Sceptical Chymist

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Quote from: European Central Bank on July 23, 2016, 04:56:28 PM

what's the deal with using an exchange? that's what i do, not that i'm buying child porn or nothing. coins go into one address. they come out of a totally separate one. fees are minimal too.

I'm in the same boat as you--privacy is more or less a minor concern with me, because I'm just using bitcoin as an investment vehicle. I don't gamble or buy anything illegal, so I could care less if my bitcoin gets tracked. There's nowhere to really track it. However, bitcoin certainly is the currency of choice for the dark markets and is extremely useful on the online casinos, and I know a lot of people don't want to be identified as using those services/sites. I don't really care to mix my coins. It's unnecessary for me, but it's a good service for others.

TippingPoint

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I have not done anything illegal on the internet, so I have never paid to launder Bitcoins. However, I still care about anonymity. I do not use Coinbase (or anything like it) that connects my Bitcoin finances with my other finances. I have a Bitcoin wallet on my desktop computer, another on my laptop, and another on my phone (usually empty). They are separate. I periodically backup and print out my Bitcoin private keys. I use TOR and other identity masking apps. I recognize the value of a reliable and anonymous poker site where BTC can be deposited, and different amounts later withdrawn with no fees. I create a new wallet address before sending or receiving. I occasionally break up larger address amounts into multiple, smaller address amounts (of random values). And I think twice before combining them again. Face-to-face cash transactions are my preferred method of converting to cash. Things like that. Just to avoid a straight path of Bitcoins, with similar amounts, at similar times, to and from the same addresses.

European Central Bank

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what's the deal with using an exchange? that's what i do, not that i'm buying child porn or nothing. coins go into one address. they come out of a totally separate one. fees are minimal too.

marky89

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Quote from: Kprawn on July 23, 2016, 03:54:10 PM

Quote from: LFC_Bitcoin on July 23, 2016, 01:44:54 PM

I understand why people need to mix/rinse coins. I don't judge people, I just mind my own business, I'm not stupid though. I know the reasons why people do it.

Ok, do not be evasive... state your reasons why you think people need to tumble their coins. You have privacy with cash, why not Bitcoin? There are not always sinister reasons behind mixing of coins.

If you valued your privacy, you should do it to. Let's take a little example : You want to sign up with a new service, but you not certain if this service is farming for information on your spending habits

or if they collecting information for marketers. You could mix your coins and then hide your original stash, and then signup with the destination address. If you did not do that, these services can trace

how many coins you have and how regularly you spend it and even on what you are spending it. See.. where privacy is valuable?

Indeed, there are a host of reasons to value privacy when transacting -- whether or not your activity is illegal. Maybe you don't want anyone linking you to buying porn or other adult entertainment services. Maybe you don't want interested parties having much idea of your assets/bitcoin savings. As time goes on and more services come online -- and governments pay increasing attention -- the need for privacy will only increase.

Kprawn

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Quote from: LFC_Bitcoin on July 23, 2016, 01:44:54 PM

I understand why people need to mix/rinse coins. I don't judge people, I just mind my own business, I'm not stupid though. I know the reasons why people do it.

Ok, do not be evasive... state your reasons why you think people need to tumble their coins. You have privacy with cash, why not Bitcoin? There are not always sinister reasons behind mixing of coins.

If you valued your privacy, you should do it to. Let's take a little example : You want to sign up with a new service, but you not certain if this service is farming for information on your spending habits

or if they collecting information for marketers. You could mix your coins and then hide your original stash, and then signup with the destination address. If you did not do that, these services can trace

how many coins you have and how regularly you spend it and even on what you are spending it. See.. where privacy is valuable?

HI-TEC99

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Quote from: smho_16 on July 23, 2016, 01:39:05 PM

Bitcoin tumbling is good for people who have high risk of going to jail if they are caught using it. Very few countries in the world can put you to jail for using bitcoins at the moment. Keep always a desktop wallet like Multibit Classic in which you can create a new address every time you do a transaction if you like. Also Multibit HD has this feature built in. You can use a VPN and go to bitmixer.io to mix your coins. There's no such thing as 100% anonymity but thats the best thing close to that. If this is the case and your government is hostile towards bitcoin you should stay away from online web wallets like blockchain.info or Coinbase, especially Coinbase. Just remember that the owner of kickass torrents was busted because he was not very smart and he was using a coinbase account with his personal details which added to clues to put him in jail.

If you deposit tumbled Bitcoins at Coinbase it might ask you to prove where they came from at any time. What happens if you tell the truth and say they were tumbled? Coinbase would probably refuse to return them and cite some clause in its terms and conditions that tumbling breaks.

LFC_Bitcoin

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I understand why people need to mix/rinse coins. I don't judge people, I just mind my own business, I'm not stupid though. I know the reasons why people do it.

smho_16

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Bitcoin tumbling is good for people who have high risk of going to jail if they are caught using it. Very few countries in the world can put you to jail for using bitcoins at the moment. Keep always a desktop wallet like Multibit Classic in which you can create a new address every time you do a transaction if you like. Also Multibit HD has this feature built in. You can use a VPN and go to bitmixer.io to mix your coins. There's no such thing as 100% anonymity but thats the best thing close to that. If this is the case and your government is hostile towards bitcoin you should stay away from online web wallets like blockchain.info or Coinbase, especially Coinbase. Just remember that the owner of kickass torrents was busted because he was not very smart and he was using a coinbase account with his personal details which added to clues to put him in jail.

pereira4

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Quote from: khalized on July 23, 2016, 02:04:07 AM

Main reason why most people prefer tumbling is privacy and not because of getting blacklisted for using gambling sites which in case only Coinbase does this kind of behavior.

In your article you mentioned about coinjoin which is not effective anymore due to the fact that you will be traced back to your main address by reverse engineering process.
Nowadays what people prefer is to mix coins via already available trusted tumbling services like Bitmixer. They have a large reserve of coins and you will be able to tumble your tainted coins easily.

I would say it's not a bad idea to always mix coins before putting your coins into a centralized service. There are lot of mixers but as far as I know one of the best if not the best mixer possible is Helix, ideally you access it with tor through their onion hidden service. You enable random transactions and delay and then you get untraceable bitcoins back. Use those to gamble and pay for stuff.
Of course with shit like Coinbase you never know, they may find out that the coins you got back from the mixer were used by some criminal activity and now you are fucked... but as far as I know Helix gives you clean coins that got recently mined so that wouldn't be a risk.

Anyway, just avoid services like Coinbase with an history of trying to trace people's bitcoins records which is stupid since we don't have control over were the bitcoins we have came from.

khalized

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Main reason why most people prefer tumbling is privacy and not because of getting blacklisted for using gambling sites which in case only Coinbase does this kind of behavior.

In your article you mentioned about coinjoin which is not effective anymore due to the fact that you will be traced back to your main address by reverse engineering process.
Nowadays what people prefer is to mix coins via already available trusted tumbling services like Bitmixer. They have a large reserve of coins and you will be able to tumble your tainted coins easily.

Posternut

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When it comes to Bitcoin, privacy is a big deal to a lot of people, and it might be because they are partaking in a type of exchange that their government doesn’t agree with. It also might be because certain Bitcoin-related businesses may blacklist you due to using gambling sites. This article is meant to give a few pointers on the various techniques of tumbling Bitcoin by sending satoshis through the laundry.

https://news.bitcoin.com/tumbling-bitcoins-guide-rinse-cycle/

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