Did you know that Bitcoin transactions are not anonymous and can be tracked with just a little effort?
Yes, tracked, if you don’t take proper measures. Being private isn’t possible with Bitcoin as it is a permission less protocol.
However, you can secure your privacy and become its anonymous user if you take care of certain things.
|Ledger Nano X (Recommended)||Hardware|
|Ledger Nano S||Hardware|
|Bitcoin Paper Wallet||Paper|
First of all, you must not let your Bitcoin address get exposed in public. For this, you should use a new Bitcoin address every time, post which you can use IP obfuscation methods. Or you can switch to anonymous Bitcoin wallets that do it for you at the backend.
Wait, but are there any anonymous BTC wallets out there? Well, there are.
5 Best Anonymous Bitcoin Wallets
1. Samourai Wallet (Mobile Wallet)
Samourai wallet is a modern bitcoin wallet, hand forged to keep your transactions private, your identity masked, and your funds secure.
I got serious about this wallet when I read this statement from its development team:
“We are privacy activists who have dedicated our lives to creating the software that Silicon Valley will never build, the regulators will never allow, and the VC’s will never invest in. We build the software that Bitcoin deserves.”
…which shows that they know what they are doing and are serious about it.
Samourai wallet is encrypted on the device using AES-256 encryption and never communicates with any servers. Apart from that, you get robust features such as PIN code and seed word backup to store your funds safely.
More Privacy Centric USPs Of Samourai Wallet Are:
- No address reuse: Therefore, Samourai will alert you if you have sent to an address before, helping prevent unintentional address reuse.
- Protection with STONEWALL: Samourai provides, by default, a transaction that increases the difficulty of linking inputs to outputs of a transaction, making clustering wallet addresses and associated metadata more difficult. Also, STONEWALL enables Samourai transactions to produce higher entropy than standard bitcoin transactions and often resemble CoinJoin transactions on the blockchain to make it more complicated to analyze.
- Tor and VPN Support: The wallet is Tor and VPN enabled, allowing you the ability to route all transactions through an anonymous IP address.
Lastly, the wallet also comes with segwit support which naturally helps in lowering your BTC transaction cost.
2. Ledger Nano X (Hardware Wallet)
Ledger is a dynamic startup company, produce high-grade Bitcoin and cryptocurrency hardware wallets.
The unique thing about this wallet is it produces a range of hardware wallets, especially for privacy-centric users. It is called Ledger Nano S & Ledger Nano X, and is slightly on the paranoid side but a remarkably anonymous wallet.
With this privacy set, you get the absolute best-in-class privacy solution – an unbeatable Ledger Nano hardware Bitcoin wallet
Some other features of Ledger Nano X are:
- NIST certified True Random Number Generator to secure your signatures.
- HD wallet provides over 100 wallets, each of which can generate millions of unique addresses.
- Hidden Wallets: Hidden wallet data is indistinguishable from random bytes – only YOU can know they are there.
- 24-word mnemonic backups enable recovery of all funds if your Ledger Nano X is ever lost or stolen.
These features and privacy, however, come at a price which is clear from the fact that Ledger Nano cost $119.
3. Rahakott Wallet (Web Wallet)
Not available anymore..
Rahakott wallet is for those who want to protect their privacy and remain anonymous while transacting in several other currencies (including BTC).
Rahakott is a web multi-currency wallet that allows its users to make anonymous transactions. And in its short period of existence, it has processed 20 million dollars in BTC.
Moreover, you don’t need your phone number or email ID to make a wallet on Rahakott, so there is no question of losing your personal data.
Apart from that, you have the option to select security features such as OTP, password, or 2-FA authentication for your Rahakott wallet.
More Privacy Centric USPs Of Rahakott Wallet Are:
- Mixer: Built-in mixer for cryptocurrencies make it impossible to track transactions.
- HD Wallet: HD wallet ensures there is no reuse of the same addresses.
- Tor: Wallet can be accessed on the Tor network to enhance your IP privacy.
4. Electrum On Tails Operating System (Desktop Wallet)
Electrum is one of the oldest lightweight Bitcoin wallets operating in this space since 2011. It is also one of the most trusted Bitcoin wallets available in the market and is an open-source wallet under an MIT license.
However, if you use Electrum wallet on Tails operating system which is very privacy-centric and is Tor enabled, it can be anonymous.
Here is a simple explanation of Tails: “Tails is a live system that aims to preserve your privacy and anonymity. It helps you to use the Internet anonymously and circumvent censorship almost anywhere you go and on any computer but leaving no trace unless you ask it to explicitly.”
Apart from that, there is no other requirement for protecting your privacy as it is an HD wallet that provides you with seed and takes no personal information.
At present, it is available for Windows, Mac OSX, and Linux.
Conclusion: How To Setup An Anonymous Bitcoin Wallet
Getting your required amount of privacy with Bitcoin transactions is quite possible. You only need to take care of a few things that I mentioned in the introduction.
But if you don’t want to do that, you should use either of the wallets mentioned above. You can also set up your custom-made wallets or methods to get an anonymous Bitcoin wallet. This exclusive guide will help you: 6 Ways To Make Untraceable Transactions With Bitcoin.
That’s all from my side in this article. I hope it helps you in choosing the right wallet.
Don’t forget to share your choice with us in the comments below 🙂
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Suggested Further Readings On CoinSutra:
- Best Multi-Signature Bitcoin Wallets [2020 Edition]
- 9 Anonymous Cryptocurrencies You Should Know About
- 3 Smart Ways To Keep Your Cryptocurrency Wallet Secure
Harsh Agrawal is the Crypto exchanges and bots experts for CoinSutra. He founded CoinSutra in 2016, and one of the industry’s most regarded professional blogger in fintech space.
An award-winning blogger with a track record of 10+ years. He has a background in both finance and technology and holds professional qualifications in Information technology.
An international speaker and author who loves blockchain and crypto world.
After discovering about decentralized finance and with his background of Information technology, he made his mission to help others learn and get started with it via CoinSutra.
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