The right solution for you will probably involve one or more of these systems working together to balance and mitigate risks present in your context. Think about who you are trying to be private from and choose accordingly.

Receiving Bitcoin Privately:

The most important part of receiving bitcoin privately is to avoid address re-use. The right solution will depend on your circumstances.

If you have a desktop or mobile wallet:

  • This will work with any wallet, but requires work to generate and distribute addresses.

If you have a business or website:

  • There are hosted versions like Voltage, or you can self-host in the cloud or on your own hardware, even on a raspberry pi, with an internet connection.

If you are familiar with Bitcoin clients:

  • This will let you publish what looks like a static address, but let's the payer generate a one-time-use address to send to. We recommend Samourai Wallet (Android) or Sparrow Wallet (desktop).
  • BOLT12 support in CLN allows for static and more private offers. Alternatively, Lightning Addresses are supported by LND.

Maximizing Your Bitcoin's Privacy:

Analytical methods to determine ownership of funds onchain rely on heuristics that cluster transactions, label inputs and outputs, and later resolve those identifiers to a real-world identity.

  • If you send funds to an exchange aware of your identity, they can be reasonably sure that the inputs to funding transactions are also owned by you.
  • This is repeated until a transaction involves a known entity.

One way to improve privacy is to transact in ways that decrease the success of probabilistic onchain analysis. There are many implementations with different mechanisms in bringing together participants..

  • JoinMarket enables an open market of participants to purchase inputs, while WhirlPool and Wasabi provide centralized coordinators that charge a fee.
  • If widely used, implementations like Teleport Transaction would make any normal appearing transaction potentially a coinswap.
  • This appears as a single bitcoin transaction with none of the exchanges of value from the Lightning Network.

Spending Your Bitcoin Privately:

The most private way to spend bitcoin is to spend it directly for other goods and services.

  • There are decentralized exchanges like Bisq, which connects buyers and sellers of bitcoin and mediates the exchange for a variety of fiat payment methods.
  • The more convenient ones like Zelle or Strike will still require that you present documents and interact with regulated financial institutions. There are more private methods, via cash by mail or money order, but are often less convenient.
  • While not as fungible as cash, use of such services usually does not require a bank account.

Bitcoin is a 24/7, global market and there are many p2p markets, including hodlhodl and your local bitcoin meetup.