Buying bitcoin has become very easy nowadays. If you want to buy bitcoin, you need to buy it through an exchange. However, tables are turned when you want to buy bitcoin, but anonymously.
The core idea behind bitcoin is decentralization. Decentralized, in turn, provides privacy, security, and transparency. However, it doesn’t have the same set of privacy if you want to go through the normal route of purchasing or selling bitcoin.
In this article, we will be exploring how you can buy bitcoin anonymously. All these methods will keep your privacy intact and will ensure that authorities(read government) don’t come to know about your purchasing habits. But, before we start, let’s try to understand how bitcoin can be purchased through traditional channels such as cryptocurrency.
Table of Contents
- Buying Bitcoin From Cryptocurrency Exchanges
- Why do I need to keep my anonymity when purchasing bitcoin?
- What are my viable options? How do I buy bitcoin anonymously?
Buying Bitcoin From Cryptocurrency Exchanges
If you are new to bitcoin, your best bet is to buy bitcoin from a centralized exchange. They have a straightforward buying process. At first, you need to register for their exchange which includes completing the Know-Your-Customer(KYC) process. As you might know, KYC means entering all self-information including government based documents.
Once done, you can then either buy it using a credit card or through other forms of currency. Some exchange offer buys option through banks while others don’t. As you can see the exchange stores your complete information and your anonymity or privacy don’t stand a chance. Centralized exchanges are against the core philosophy of blockchain, but that’s a topic for another day.
Why do I need to keep my anonymity when purchasing bitcoin?
Purchasing bitcoin or matter of fact, any cryptocurrency is a personal thing, and you should not tell anyone where how, when and where you bought bitcoin. Governments are notorious when it comes to scrutinizing bitcoin or cryptocurrency related purchases. Also, if you are a massive buyer or splendor in the cryptocurrency world, you might attract unwanted attraction from companies selling you solutions or frauds trying to trick you. In any case, having anonymity can provide you complete peace of mind, giving you the necessary layer of protection when making high-value bitcoin transactions.
What are my viable options? How do I buy bitcoin anonymously?
Now, that we know how your information is stored within a centralized exchange, it is time to learn the methods through which you can buy bitcoin anonymously. Let’s get started.
Person to Person Purchase
The best way to keep your anonymity in check is to buy bitcoin in-person. Using platforms such as Localbitcoins.com can give you the necessary information to carry out a purchase. You can use the platform to learn about local buyers and then contact them. However, as you are going through a platform, your privacy is at risk. The best approach is to purchase through an acquaintance whom you have known for long and feel safe to deal with. This way you can protect your privacy against unwanted people and also purchase bitcoin. If the person from which you are buying bitcoin is in the crypto or mining industry, then you are in luck as they periodically need to liquidate their crypto for real-world funds.
But beware of face-to-face transactions as they are not completely private. The best possible way you can keep your anonymity is to buy online.
Buying Bitcoin Anonymously Online
Few marketplaces let you buy bitcoin without the need for KYC. One such marketplace is Bisq. However, it lacks the liquidity and spot prices that you can get from a centralized exchange. To make a purchase, you need to make payment using bank transfer or e-wallet. Once done, the seller will send the said bitcoin amount to your wallet. The platform governs the whole process. Bisq is a great alternative to Localbitcoins.com, the only difference being that you do not have to meet up locally. You can also try Hodl Hodl, a P2P marketplace where verification is made optional. Oh yes, check CoinMama, another exchange that doesn’t require I.D.
Taking advantage of Bitcoin ATMs
Bitcoin automatic-teller machines also give you the ability to buy bitcoins without losing your anonymity. You can find Bitcoin ATMs in major cities. However, they do offer a unique way to interact with the crypto world. These Bitcoin ATMs work without debit/credit card which makes it ideal for privacy-oriented transactions. If you see a Bitcoin ATM, all you need to do is put in cash, and get your bitcoin. However, not all Bitcoin ATM works in this fashion. There are few ATMs where you need to put a form of “I.D” such as palm print.
The downside of opting for Bitcoin ATMs is that you need to carry out a huge amount of cash to buy a decent amount of bitcoin. However, if you do, you are operating in complete privacy(just make sure that you are not followed!).
Using Prepaid cards with P2P Exchanges
The last method that we are going to discuss is to take advantage of prepaid cards. These prepaid cards can work amazingly when combined with P2P exchanges. All you need to do is fill your prepaid card with cash and then use it during peer-to-peer exchanges such as LocalBitcoins — or other exchanges that don’t require any I.D.
Bitcoin is not entirely anonymous. It offers partial anonymity, and that’s why we have privacy coins such as Zcash or Monero. Keeping the technical aspect of bitcoin privacy aside, you can buy bitcoins anonymously. We discussed a few methods that let you do so, some with complete privacy while others are providing you partial privacy. In any case, you should always be wary of steps that you take during bitcoin transaction. A single mistake can blow your anonymity and the hard work that you have done to keep it that way until now. Also, did you like the guide? If yes, comment below and let us know. We are listening.