People often question identity when using bitcoin – which is quite understandable. Actually, it is a bit confusing to analyze what part of your name and your personal information will be associated with the bitcoin platform. . While praised for allowing users to transact anonymously, you should be aware that bitcoin uses peer-to-peer ledger technology. This technology records all transactions and traces the person who made the transaction. So are you really anonymous when using Bitcoin?
The short answer is not entirely. Although the name of the person making the transaction never appears, the transaction uses specific addresses, which can be seen as your identity. However, this information does not reveal who you are in real life. That is why bitcoin is seen as “anonymous in the form of anonymity.” If a user’s Bitcoin address reveals their true identity, their activities can be traced. If not, they can only be traced back to their fake names on Bitcoin.
The Bitcoin ledger is based on blockchain technology that will keep all the transactions made. Someone thinks that users should change their address after each transaction to avoid being traced back to a single account. But doing so does not completely guarantee anonymity, as public blockchain analysis can link these different addresses and retrieve users. So as long as one of these addresses connects to your real-life identity, no matter how many new addresses you create, your real identity can still be found.
To deal with this, there are a few methods to increase anonymity or at least make your identity a little more difficult.
Take advantage of the mixing service, which will swap certain bitcoins for other bitcoins with different transaction history. That eliminates the risk of someone linking input and output and discovering your true identity. But the bottom line is, the mixing service should not keep any records of the transactions and should be reputable in the exchange of bitcoins.
Another option is to use the anonymity service of an online bitcoin wallet. Online wallets will gather bitcoins through the service and then send money to users after each withdrawal. Of course, it is necessary to have a large resource to store money and completely hide the details of the transaction via the service.
However, regardless of the method, it does not completely guarantee anonymity. But nonetheless, for many people, not quite as anonymity is more than enough.