Just another quick note: Bitcoins keep track of every single transaction. That information is filed into the bitcoin itself.
Do not think that this is anonymous money, it is anything but. You’re still best off using cash for anonymous transactions or buying one use cards, etc… for online anonymous transactions.
China got bitcoin right. It is a virtual good. You could just as easily use any other virtual good to transfer money out of a country, so long as there is a liquid market you trust.
Badtux
Yes and no.
Forbes has the real scoop here. Bitcoins can be traced to a certain extent… but there are significant limits to how far they can be traced. The complete transaction history is *not* possible to obtain — once bitcoins “mix” together into a single bitcoin account, where they go from there is untraceable.
Ian Welsh
That article is damning – she was able to identify 295,435 addresses. If the NSA throws themselves at this, and they will, with their resources, unless you are very tech savvy, you will get yourself caught.
markfromireland
Not according to a friend of mine who works in the Danish Tax Department’s special investigations division. I asked her about just this point and her reply was that though it wasn’t easy it could be done.
mfi
Dan H
The transactions aren’t the real danger. For an account to have any use you’ll have multiple transactions…they’re not worried about a lack of chances there. The problem is browsing habits and activity being tied to your account. Can’t login to your Google account from the same machine id or IP address that signed into that “anonymous” bitcoin account etc…and staying on top of that is difficult.
markfromireland
@ Dan H January 23, 2014
Yes, pretty much. And incidentally anyone who thinks that for example the various Tax SIDs both within the EU and outside of it such as for example the American IRS don’t share information such as this is being remarkably obtuse. There are far far far fewer legal and logistical obstacles to their doing so than there are legal and logistical obstacles to sharing between law enforcement agencies.
mfi
pebird
Funny how the “progressive” libertarian high-tech crowd would pooh pooh our complaints about loss of privacy when we criticized Google, Facebook, etc., telling us “get over it, there is no privacy anymore”.
But when it comes to electronic money, suddenly one of the key features is transaction privacy, touted by the same folks who tell us “to get over it”.
Whether it is blind ignorance or willful misdirection doesn’t matter.
TarheelDem
The bitcoin standard is optimized for transparency and peer-to-peer behind-the-scenes auditability of transactions. The identifying unit is equivalent to a wallet. The standard itself does not require referencing the wallet to any other identifier, but if you want to exchange bitcoins into other currencies or manage multiple wallets, somewhere there has to be established a relationship between the wallet and a person and likely an ordinary financial account of some kind. And that’s where the privacy issues exist–with the firms implementing the bitcoin exchanges.
But most financial web sites are not optimized for privacy either. They are optimized for minimal investment and expenditure in equipment and IT staff–just offsetting the risk to privacy but not optimizing for privacy.
If however you want more emphasis on privacy in bitcoin, it is after all a functioning open-source project that continually collects new requirements.