Episode 12: Is Blockchain Anonymous?

Hey everybody!

Jason King here from Kingsland University.com, Kingsland School of Blockchain.

The first and only fully accredited school for blockchain development. I’m counting down the top 99 questions about blockchain technology that have been asked to us. Today’s question that I’m a go through is. Is blockchain anonymous?

Great question, and the answer is, maybe. It can be. Blockchain technology by default, people who own individual accounts on the blockchain, that’s not known immediately. So, it is possible for you to take care of your own security in a way, where it’s very difficult to trace who the identity is of the person who holds it.

But you have to think about one of the key facts that we talk about a lot about blockchain is that it’s immutable. Once something’s been written to it, it’s impossible for you to ever take that back. It’s just public record at that point. So, if you were to say have a bitcoin address and you took some bitcoins into it. Well, it might be very difficult to trace at that point in time. But if sometime in the future you did something like you spent those bitcoins or you spent something from that wallet and you spent it through a third-party service that asked who you were, because maybe they needed to ship you something or you had to sign a contract. And as part of that you made a payment and now your identity is actually permanently tied to that bitcoin address. 

So from that point forward, you’re not anonymous anymore. Not even pseudonymous. It’s actually fairly easy to track. That’s one of the really weird things when people talk about using bitcoin and cryptocurrencies for nefarious things. Because bitcoin is this anonymous thing. Well, it’s not!

It’s actually kind of a pretty lame way to hide your identity when doing terrible things. Because there is a permanent record! So, if you want to do terrible stuff you should probably stick to cash. Because cash is actually pretty anonymous.

I’m Jason King, Kingsland School of Blockchain, KingslandUniversity.com.

Take care.

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