Why You Should Care about Financial Privacy and How to Protect it in Bitcoin World

As is commonly known, people start valuing things once they essentially lose them. And losing privacy, especially in the financial sense, can have some dramatic consequences.

Losing Financial Privacy Cannot Happen – Really?

While many would heroically argue that losing financial privacy is impossible, especially in today’s world, this could not be further from the truth. All the KYC/AML information that major banks, neo-banks investment services or other providers collect show that privacy in the financial world is long gone.

While cash provides some form of financial privacy now, it will not take so much time for central banks to release their central bank digital currencies, by which they will try to make cash obsolete. Once that happens, anything and everything that goes on in your financial life will be immediately known to governments and authorities.

With full knowledge about what you do with your finances, governments and central banks will also have the power to influence your spending behavior, which can lead to such measures as a rejection of purchases solely based on the decision of governments.

Thus, the inherent right to decide how you spend your money can be lost. Moreover, doing things that are legal today can quickly become illegal, such as holding Bitcoin private keys. That is exactly what happened in 1933 with Executive Order 6102, which forbade the hoarding of gold in the United States.

In that example, once the government knew that the residents were holding gold, they could forcefully take it out of their hands under the threat of jail time or a fine. The same can very easily become true of Bitcoin if more anti-Bitcoin laws are put in place.

How to Get Bitcoin Privately?

While there are not that many options for normal people to have privacy in their financial world, unless they want to hoard piles of cash which is losing money due to inflation, there are still some that are relatively easy to understand and easy to apply.

One of those options is Bitcoin. For starters, it needs to be stated that Bitcoin is not anonymous. Instead, Bitcoin is pseudonymous. But, thanks to the use of some tools and techniques, anyone can make sure that the privacy of their Bitcoin stash increases.

First, it is much more effective to get Bitcoin privately, then get it through any KYC exchange or KYC service and then try to make it private or anonymous. While some features and tools can help with this, having privacy in mind from the beginning pays off.

There are several different ways how people can get into Bitcoin without revealing their identity. Buying Bitcoin peer-to-peer, using Bitcoin ATMs (without KYC procedures, of course), buying Bitcoin with cash, or mining it. Those are just some of the options that are pretty accessible to anyone who is not only interested in owning Bitcoin but also staying anonymous.

Then there are wallets and service providers such as Wasabi Wallet or Samourai Wallet, which have privacy as their main goal. These Bitcoin wallets offer interesting features such as CoinJoin or coin control, which can help with improving or keeping the privacy of the holders of the coins. In most cases, these applications are free to download and do not ask for any KYC procedures.

Whir Offering a Different Alternative

Another possibility is using Whir. Whir offers solutions similar to Wasabi Wallet and Samourai Wallet but has an added bonus of not needing to download a new application or wallet. Whir is very intuitive, as it works like a traditional Bitcoin transaction and helps with privacy thanks to the usage of CoinJoin.

Thanks to this, both the sender and receiver will increase their privacy in the eyes of on-chain analytics companies. Pretty straightforward solution with a nice benefit of improving the anonymity of its users for a relatively low cost, as Whir only charges 1 % of the transaction as its fee.

Conclusion

All these and many other features, services, or tools can help everyone be in charge of their financial privacy. While being a basic human right, the right to transact freely and anonymously is getting slowly pushed out of the way thanks to the forces of governments and central banks all around the world.

Thus, to stay on top of it all, potential Bitcoin users should think in advance whether they want to benefit from one of the most crucial features of Bitcoin, censorship-resistant transaction, or whether they want to oblige with their Bitcoin stash to the rules that have the potential to make this key feature obsolete in the hands of those, who do not value their privacy from the beginning.