Bitcoin has come a long way since it was first released in 2009. Realistically, it wasn’t until 2017 during the crypto craze that most people were familiar with it at all. While it definitely took it’s time finding its feet, cryptocurrency has proven to deliver exactly what was promised. As cryptocurrencies may not have changed, governing bodies have definitely stood up to take notice. And with that attention is a promise of change.
It may come as a bit of a surprise to learn that original formats for modern-day cryptocurrency were actually conceived as early as 1983. Being implemented in a number of electronic transactions that are used by fiat around the world today. It wasn’t really until 2009 that bitcoin invented Satoshi Nakamoto developed the anonymous, decentralized and deregulated currency known as bitcoin.
While the coin still stands firmly decentralized, many governments are attempting to put their own regulations onto the currency. Asking for tax information and now attempting to track transactions and tie them to specific users, the powers that be have now begun to strip away cryptos anonymity as well.
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How Bitcoin Mixers Can Help Secure Your Transactions: What This Means for Bitcoin
The efforts to keep bitcoin and other cryptocurrencies safe may well be their undoing. The way in which bitcoin functions without a centralized power is all down to the way transactional information is created and stored. The way that bitcoin retains its value is all down to the way that it is produced, secured, and released.
While these two specific functions of bitcoin are not only extremely necessary to the way bitcoin is designed to function, they can also be used to destroy the basis on which it was designed.
While bitcoin is by far the most recognizable and popular decentralized cryptocurrency, many of them that saturate the market today work in the same fashion. What keeps cryptocurrency decentralized is the way that transactions are coded, stored, and publicly verifiable.
Cryptocurrencies work by using a technology called blockchain. Instead of having a banking institution log and manage transactions, cryptocurrency transactions are dealt with via independent users called “miners”. Miners solve complex cryptography problems and add them to a log called “blockchain”. For their efforts, they are rewarded in bitcoin or whatever currency they are mining.
The blockchain becomes a binding ledger, storing immutable information on where the bitcoin came from and where it was deposited. Then these ledgers are made fully public, to keep the transactions honest and prevent them from being changed in the future.
While there is no personally identifying information stored in the blockchain- no names, no account numbers, no addresses- there are complex and long “keys”. These keys are what are used to identify the source holders of the bitcoin.
Most keys are attached to online “wallets”. These wallets function similarly to a bank account, only one that simply requires an email address as opposed to personal information.
The blockchain has been in existence just as long as bitcoin has. This means that any transaction that has ever been made with bitcoin can be viewed by anyone who cares to look. Keeping big banks out of the system while still finding a way to make transactions secure.
The transparency of these ledgers makes it almost impossible to create fake bitcoins. This is one way that bitcoin retains excellent value. There is a finite amount of bitcoin in existence.
Furthermore, the amount of bitcoin that exists is released slowly and continually, at a predetermined pace. In 2009, 21 million bitcoins were created and stored. Few bitcoins were released as an ICO in that year. People began using these coins and transactions occurred. As miners began producing segments of the blockchain (blocks), and transactions were logged, more coins were released.
Currently, 50 bitcoins are released for every block that is logged. The number of bitcoins that are released halves every time 210,000 blocks are logged. This “halving” occurs roughly every four years. Meaning that traders can keep a close eye on the ongoing supply of circulating bitcoin and inflation cannot be manipulated.
While this format makes bitcoin valuation far more stable and predictable than other cryptocurrencies, it brings us back to the pseudo-anonymity that bitcoin must have in order to function properly.
How Bitcoin Mixers Can Help Secure Your Transactions: The Key Point
So as you can see, any wallet key is not only unique to one specific user, but any transaction that is performed is also unique to that user. Making it much less difficult for governing bodies to trace transactions back to individual users.
While email isn’t necessarily a reliable source of identity, what can serve to give corporations and governments identifying details are often overlooked. Should you use a shipping address for a bitcoin purchased item, your IP address, a name or bank account number when exchanging bitcoin for fiat or vice versa – all of these things can serve to attach an identity onto any bitcoin transaction.
Which for companies and governments, is not difficult to obtain. Using algorithmic technology, other entities with the right amount of time, skill, and money, can find recurring transactions and tie them to specific users.
Making bitcoin far less decentralized and anonymous than one would like.
The Bitcoin Mixer
Which is exactly where a bitcoin mixer comes in.
If you’d like to keep your bitcoin transactions anonymous, there are still ways in which to achieve this. You can do it on your own: using a complicated process requiring hundreds of different wallets and never using the same key twice-
You can use a bitcoin mixer. Keeping your transactions safeguarded against prying eyes and keeping your personal holdings, personal.