Protecting Your Privacy

Now that you understand why privacy matters and how chain analysis works, let's look at what you can do about it.

This page provides an overview of privacy techniques. Each has dedicated guides for implementation.

The Privacy Mindset

Before diving into techniques, adopt these principles:

1. Think Before You Act

Every transaction leaves permanent traces. Ask yourself:

• Does this link my identity to this address?
• Am I revealing information unnecessarily?
• Could I do this more privately?

2. Separate Your Identities

Don't mix:

• KYC bitcoin (bought from exchanges with ID) with non-KYC bitcoin
• Work-related transactions with personal ones
• Public donation addresses with private savings

3. Minimize Data Leakage

Share only what's necessary:

• Use new addresses for each transaction
• Don't post addresses publicly unless required
• Consider who can see your transaction

Privacy Techniques Overview

Level 1: Basic Hygiene

These require no special tools—just awareness.

Technique	What It Does	Difficulty
Never reuse addresses	Prevents linking transactions	Easy
Use your own node	Stops leaking addresses to third parties	Medium
Avoid address posting	Prevents web scraping	Easy
Separate coin sources	Keeps identities apart	Easy

Level 2: Active Protection

These require learning specific tools.

Technique	What It Does	Guide
UTXO management	Control which coins you spend	UTXO Guide
Coin control	Choose specific inputs for transactions	Coin Control
Labeling	Track coin sources and privacy levels	UTXO Guide

Level 3: Breaking the Chain

These actively defeat chain analysis.

Technique	What It Does	Guide
CoinJoin	Mix coins with others to break history	CoinJoin Guide
PayJoin	Hide payments in normal-looking transactions	Coming soon

Run Your Own Node

Why it matters:

When you use someone else's node (or a public server), you reveal:

• All your addresses
• Your transaction history
• Your IP address (potentially)

With your own node:

• Your wallet queries stay local
• No third party sees your addresses
• You verify everything yourself

→ Learn: What is a Bitcoin Node | Why Run Your Own

→ Guide: Bitcoin Node Setup

UTXO Management

Why it matters:

UTXOs (Unspent Transaction Outputs) are the individual "pieces" of bitcoin you own. How you manage them affects:

• Privacy: Combining UTXOs from different sources links them
• Fees: More UTXOs = higher transaction fees
• Traceability: Careless spending reveals your activity

Key practices:

1. Label everything — Know where each UTXO came from
2. Keep sources separate — Never combine KYC and non-KYC coins
3. Use coin control — Manually select which UTXOs to spend
4. Consolidate carefully — Only combine same-source UTXOs

→ Guide: UTXO Management

CoinJoin

Why it matters:

CoinJoin directly breaks the chain analysis heuristics by:

• Combining inputs from multiple people (breaks common input ownership)
• Creating equal outputs (hides which output belongs to whom)
• Adding ambiguity to transaction graphs

After a CoinJoin:

• Analysts cannot determine which output is yours
• Your transaction history is "broken"
• Coins gain forward privacy

Important considerations:

• Mixed coins must be handled carefully after
• Some exchanges flag CoinJoin transactions
• Proper post-mix behavior is essential

→ Guide: CoinJoin

Acquiring Bitcoin Privately

The acquisition problem:

If you buy bitcoin through a KYC exchange, your identity is linked from the start. Even the best privacy techniques cannot fully undo this.

More private acquisition methods:

Method	Privacy Level	Tradeoffs
Peer-to-peer (P2P)	Higher	Requires more effort, potential scams
Bitcoin ATMs (some)	Medium	Often have cameras, some require ID
Earning bitcoin	Higher	Employer/client knows your address
Mining	Highest	Expensive equipment, technical knowledge

→ Guide: Coming soon

Network-Level Privacy

The problem beyond blockchain:

Even if your transactions look private on-chain, you might leak information at the network level:

• IP address — When you broadcast a transaction
• Timing — When you come online
• Connections — Who you connect to

Solutions:

Tool	What It Does
Tor	Hides your IP address
VPN	Hides your IP (but VPN provider sees it)
Own node	Broadcast transactions through your node
Own node over Tor	Best combination

→ Guide: Tor Setup

What You Cannot Fix

Some privacy losses are permanent:

Situation	Why It Can't Be Undone
KYC exchange withdrawal	Exchange has your identity forever
Posted address online	May be archived, scraped, saved
Sent to identified address	That transaction is permanent
Blockchain history	The past cannot be changed

What you can do:

• Start fresh with new coins
• CoinJoin existing coins for forward privacy
• Be more careful going forward

Privacy and Tradeoffs

Every technique has tradeoffs:

Technique	Privacy Benefit	Cost/Risk
Own node	No address leakage	Disk space, setup time
CoinJoin	Breaks transaction links	Fees, time, potential exchange issues
P2P buying	No KYC link	Premium price, counterparty risk
Coin control	Better UTXO privacy	Manual effort, learning curve

Choose based on your threat model and resources.

Building Your Privacy Practice

Start here:

1. ✅ Understand the risks (you've done this)
2. ⬜ Run your own node → Bitcoin Node Guide
3. ⬜ Learn UTXO management → UTXO Guide
4. ⬜ Practice coin control → Coin Control Guide
5. ⬜ Consider CoinJoin for existing coins → CoinJoin Guide

Ongoing habits:

• Never reuse addresses
• Label all incoming transactions
• Keep different sources separate
• Think before each transaction

Key Takeaways

• Run your own node to stop leaking addresses
• Manage UTXOs carefully to prevent linking
• CoinJoin breaks chain analysis heuristics
• Acquisition method determines starting privacy
• Some losses are permanent — prevention is best
• Build habits — privacy is ongoing, not one-time

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Practical Guides

Ready to implement these techniques?

• Bitcoin Node Setup — Stop leaking your addresses
• UTXO Management — Control your coins
• Coin Control — Choose what you spend
• CoinJoin Guide — Break the chain