Bitcoin is the popular globally accepted cryptocurrency that everyone can use in the world. Suppose you live in India and want to transfer bitcoin to your friend living in Canada. You can transfer bitcoin to his bitcoin wallet quickly. Still, if you choose another method through third parties, they will charge you high. You have to fill many formalities to show the government, transferring the currency to a Canadian dollar to reduce the amount. But the question is, can bitcoin payment be traced or not? So, in this article, we will clear the doubt about the bitcoin transaction’s anonymity. So, without wasting time, let’s explore the anonymity of bitcoin transactions.
Before going further, first, we have to understand the blockchain. Blockchain is a public ledger which means all the transactions that occur on the network will be stored on the blockchain network. Suppose, if you buy bitcoin from someone or sell bitcoin to someone, that will show your transactions on the blockchain network with the amount and the sender and receiver. Some people use exchanges because they do not want to show their transaction amount and transaction id. Blockchain is also known as a public ledger because anyone can check bitcoin users’ transactions, whether current or previous transactions.
Blockchain is the first platform and the world’s most secure platform where the first transaction of bitcoin occurred.
Blockchain is a decentralized system and impossible to hack because many miners are working behind the blockchain. If you want to hack the blockchain, you have to hack all the computers working behind the blockchain worldwide. A decentralized system means no third party can control bitcoin, whether it is the government, banks, financial institutions, or even the founder of bitcoin.
Your transactions on bitcoin are not traceable if you are using the blockchain platform for commerce. You need your email address to sign up on the blockchain. When you do transactions, your transactions will list on the blockchain. Everyone can see your transaction id and the amount you transferred or received. But the main thing is that you are anonymous on the blockchain. No one can get your email address or mobile number or see your name because they can only see your transaction id. So you are anonymous on the blockchain because everyone can see your transaction id but not your name, email address, mobile number, or other identity proofs. You can use various bitcoin wallets to make it more complex to trace your transactions. Suppose you have bitcoin and you are using the blockchain wallet. You can create a new wallet and transfer the amount to that wallet. You can now make a new wallet, and now you can share the amount to that wallet that will make it more difficult to understand.
Exchanges are not anonymous:
Some people do not use a blockchain because they want to hide their identity. Exchanges provide extra service to hide the transactions on the blockchain, and no one can see your transactions id and amount. Still, you are not anonymous on the exchange. Exchanges are third parties, and to know more, click here at autoprofit.app and they have to give the record to the government. When you create an account on an exchange, you have to fill in your personal information, such as your name, mobile number, and email address. After creating an account, you must complete the KYC by submitting your live phone, identity proof, and signature. Now all the data is stored on an exchange. And they keep your transaction’s track. Suppose you will do any illegal activity and want to know your transactions. In that case, they have to submit all the history of your transactions. So exchanges are an easy way to buy and sell bitcoins because you can buy and sell bitcoins in exchange in a few clicks. Still, your privacy of payment or transactions is not anonymous.
From the above information, we have learned that bitcoin is a decentralized system that means your identity is anonymous because no one is the controller or manager of bitcoin. Blockchain is the public ledger where all the transactions are stored, and you have to create your account on the blockchain. Now you are ready to transfer and receive bitcoins in your blockchain wallet. Everyone can see the amount and your transaction id, but they cannot track your identity.
Danica is working as a professional news editor at Crunchoid Inc. She is accustomed to finding daily reports.