Question to the UTXO OGs:
Does consolidating UTXOs you received directly from an (KYC)exchange to a new adress help to improve privacy?
I am not talking about coinjoining. Just consolidating some UTXOs to new adresses. I asume this would help when trying to deny that you have access to the mentioned UTXOs, because they don’t sit in adresses they know you control. You could say you accidentally moved them to wrong adresses or traded them for something. Or is this too shortsighted?
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Replies (45)
IMO. Shortsighted, bad opsec. A least send it to lightning and then back to main chain.
No, it's actually bad for privacy
But if the UTXO are already all linked to your identity, you don't lose much by consolidating them I guess
sending UTXO (parts) to a different address (not consolidating) gives you plausible deniability. But not much so if you consolidate
Consolidating UTXOs from KYC exchanges is never good for privacy.
Off course the Exchange (and the government) already knows those UTXOs belong to you but by consolidating you basically let the whole world know those UTXOs belong to a single person.
If the the UTXOs are smaller than 1 Million sats it makes sense to consolidate, higher I would not consolidate. Moving them (separate transactions over time) to other wallets makes sense , moving them into Lightning Channels by using a submarine swap is better for privacy.
Alternatively you can swap into Liquid than swap to lighting and once you have enough you swap back on chain with big UTXOs
so if you want to go with the plausible deniability route, you should spend randomly, spread out over time, to fresh addresses
But remember KYC coins will always be KYC coins , you can coinjoin from the moon to Jupiter, the fact that you bought them on a KYC exchange and never sell them back to the same KYC exchange means you need to prove that you spend them otherwise the assumption is that you still have them
There's no such thing as "KYC coins". If that will exist, then Bitcoin will be a failed experiment, will exist two different coins that have nothing to do one with another.
So please stop saying this bullshit of "KYC coins".
As long as you use the 3 levels stashing, where in the middle level (cache) you are doing all the UTXO management, is OK.
But never send UTXO straight to your cold wallets.
Also keep in mind this chart for UTXO consolidations
Also keep in mind this chart for UTXO consolidations
thanks mate 🙏 already read your guide(s)! I struggle a little bit with understanding the cache wallet principle. Wouldn't it serve the same purpose to use a specific set of adresses within the same wallet as cache adresses and distribute the coins from here to new adresses in that same wallet? Since adresses can not be known to which wallet they belong, there would be no indication that it is the same wallet? 🤔
So… which one is it? I wanna learn
thanks mate. very goog advice. especially the show-the-whole-world-thing was something i did not consider 🙏
I have the same question here as i asked darth coin: does it have to be a whole nother wallet to move the UTXOs to? Is moving them to new adresses inside the same wallet not enough? How could one tell the difference from the outside?
I see, but how could one possibly prove the coins where sent to a wrong adress one does not have access to? 🤔
thanks mate, much appriciate your advice 🙏
So could this fresh adresses be within the same wallet or can they be linked in some way?
Good advice, thanks mate 🙏
The "cache wallet" in fact are many wallets, with many addresses. Some of them could be disposable wallets, using them only once or few times.
Some of them are decoy wallets (could be custodial non-KYC) where you use them only to deviate the "attention" from your other cache wallets.
When I say use the 3 levels, it doesn't mean to use only 3 wallets. It means to use many wallets and apps. Each one with its own use case.
You don't have to prove anything.
Is not anybody's business what are you doing with your own money.
Is just Bitcoin.
The CEX is not KYC your coins, is KYC your identity. That is the danger because the data could be sold, used, leaked without your permission.
The coins are absolutely the same and once you take them into self-custody is nobody else business what are you doing with them.
thanks for clarifiyng. still one question remains unanswered to me: can i use fresh adresses within the same wallet equally as fresh adresses in another wallet or could they be linked if they are within the same wallet?
But: if the government wanted to seize your coins (the ones they know about), they could try to force you to hand them out, couldn't they? put you in arrest, let you pay fines ... in that case wouldn't it be good to have implemented some ways to plausible deny you still have control over those coins?
can be within same wallet, yes. I recommend checking out sparrow wallet, which is a little bit on the more technical side, but it will give you a good insight into your utxos
boating accident 🥺
thanks for confirming mate 🙏 i already love sparrow 😅
not considering other factors, from the outside it is not possible to tell if 2 addresses are from the same wallet/seed
that only works as long as the coins don't move. If they move in the future, they can asume, you regained control over those keys.
If the coins are in self-custody, how in the hell are they going to seize them?
There's no "seize" for self-custody. That's why they hate it.
And not gov should be your biggest concern. Govs do not care about your coins in self-custody. They care about the USD in a bank account and keep you enslaved.
So if you never ever go back to fiat, you have nothing to be concerned.
not even that.
If somebody else is asking about my BTC, my simple answer is this: is not your damn business.
If I open a big phat LN channel with an UTXO and never close that channel... I could pass through infinite amount of sats, without any trace of moving funds onchain.
... just think about that.
that's what i meant. they CAN'T seize them, but they CAN put repressions on you, as long as they think you have control over the coins.
i am thinking specifically of what happened with the seizure of gold with Executive Order 6102
but that channel has to be opened in advance since an onchain tx is needed to poen it, or isn't it?
6102 event will never happen on self-custodied BTC.
Even Satoshi told us in some kind of encrypted message...
You are putting the wrong question...
https://video.nostr.build/80aa9a7c3d75e022658c59bbcfa860fef1e623f6bee4121357596462b64bf9c7.mp4
Beautiful 🥹
If you have a UTXO from a CEX, then use it to open a LN channel.
Then through that channel you can "mix" infinite amount of sats from other UTXOs.
I was today years old when I understood that.
Tell that to the KYC fucktards that followed my withdrawals 3 levels deep and blocked my account because I coin joined. Lessons learned
They blocked your account because you want to sell BTC for fiat.
NEVER GO BACK TO FIAT.
As long as you don’t spend them from that address.. the moment the coins are spend you are fucked
I never sold bitcoin, what are you talking about?
No you are not. Spending your sats on things you need in your life (food, shelter) have nothing to do with selling back for fiat.
ONLY FIAT MAXIS ARE FUCKED.
That happen ONLY when you deposit BTC to be sold for fiat. Not the way around.
Tell that to the IRS 🤣 , in stasi Europe the exchanges will have to report your KYC purchases to the governments soon
Bullshit! I had an account with a European shitcoin casino and they followed coins after withdrawal!! They kicked me out because I send my withdrawn coins to whirlpool, I have the receipts
Fuck! Did you send directly to whirlpool from the withdrawal adress?
Nope! 2 steps in between
So? They did you a favor.
Instead of sending them to a whirlpool why not opening a LN channel and buy some groceries, as NORMAL people do ?