Watch video presentation https://www.youtube.com/watch?v=Vj8Pa3Nfdjc Is this statement holds true in the sovereign world: "If I have nothing to hide I have nothing to fear"? Bitcoin is often compared with being your own bank. But it also comes with being responsible for the bank grade security. Privacy is an integral part of any OpSec more so for Bitcoin handling.

1. PRIVACY
AND
BITCOIN

2. Why Privacy
● Fungibility - blacklists add friction, Bitcoin less valuable
● Efficient operation of free market (costs of business
must be private to effectively price)
● Personal safety (wealth, purchases, ID theft, scams)
● Human dignity (habits and preferences)
● Financial privacy incompatible with law enforcement
(volunteer to provide records)
● Globally visible public records - undesirable, intolerable

3. Bitcoin
● Public transaction
● Traceable
● Permanently stored (can be traced in the
future)
● Attack - Connect ID and address
Unprecedented level of transparency that most people are not used to
dealing with.
Bitcoin addresses are the only information used to define where bitcoins
are allocated and where they are sent.

4. UTXO - Bitcoin Transaction Model
Address/Wallet Clustering

5. Blockchain Attacks on Privacy
● Common-input-ownership heuristic
● Change address detection
● Address reuse - Payment Output
● Wallet fingerprinting (address formats,
change order, number of inputs and
outputs, miners fee, coin selection
● Round numbers (converted to fiat)

6. Blockchain Attacks on Privacy
● Input amounts revealing sender wealth
● Forced address reuse
● Amount correlation
● Timing correlation
● Batching

7. Non-Blockchain Attacks
● Custodial Wallets
● Wallet history retrieval from third-party (SPV,
Electrum server, Blockchain explorer)
● Communication eavesdropping
● AML/KYC
● Digital forensics (addresses and ID on a hard
drive)

8. Improve Privacy
● Obtain Bitcoin anonymously (cash, earn, mine)
● Spend anonymously (hide ID, address, IP)
● Wallet history (full node, Wasabi, Tor, Electrum
server)
● No address reuse (labels and do-not-spend
forced address reuse attack)
● Coin Control (Labels)

9. Improve Privacy
● Change avoidance
● Multiple change outputs
● CoinJoin (Wasabi)
● Off-chain (Lightning, Side chains)
● Wasabi, Samourai (DoJo), Liquid

10. Chain Analysis
● Running nodes (up to 30%)
● Collect IP-addresses, cluster wallets
● Discover and profile addresses (exchanges,
published, dark markets, ATMs, businesses)
● Deploy heuristics

11. Chain Analysis

12. Chain Analysis

13. $5-Wrench Attack
● Don’t talk about your wealth
● Use multsig with keys in
multiple locations
● Bear arms, hire guards, rely on
police or army
There are two ways to beat this attack: by hiding or by defending yourself.
You can't be your own bank without
bank-level security.

14. Tips
● Backup your seed phrase
● Never Keep Coins on Exchanges
● Protect your addresses
● Learn about security
● Denis Serebryakov
twitter.com/ThatCryptoTO