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Bitcoin offers privacy -- as long as you don't cash out or spend it

Jeremy Kirk | Aug. 28, 2013
Most users do not use sophisticated methods that would more deeply mask their transactions.

Money laundering is not impossible, but it is not particularly attractive with bitcoin. "It seems like an offshore account at this point would be a lot easier," she said.

Still, as long as bitcoin users are willing to take certain cumbersome steps, such as generating new bitcoin addresses for every transaction, staying off the exchanges and using other evasion techniques such as repeatedly forwarding funds, Bitcoin retains its privacy strengths.

"I do think inherently Bitcoin can provide you with a huge amount of anonymity, but the argument here is you have to work for it," Meiklejohn said. But most patterns of bitcoin use "indicate most users are falling short."

Meiklejohn co-authored the paper with Marjori Pomarole, Grant Jordan, Kirill Levchenko, Damon McCoy, Geoffrey M. Voelker and Stefan Savage.

 

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