So, you’ve finally decided to take your bitcoin off an exchange and store it in a hardware wallet. Smart move.
Storing your cryptocurrency in a wallet minimizes the risk of your funds being stolen by hackers who commonly target exchanges for their mischief.
As an extra layer of security, you should also take privacy into consideration when choosing a wallet. Many people equate the desire for privacy. Using an anonymous wallet separates your personal information from your funds preventing anyone from tracking you down to get a slice of that sweet, crypto pie.
Surprisingly, there aren’t many wallets on the market that focus on keeping you anonymous.
In this article, I’m going to outline four of your best options so that you can find one that works best for you.
Samourai is one of the newest anonymous wallets available. Unfortunately, the product is currently just in alpha, and you can only use it if you have an Android phone. For a wallet with a primary focus on privacy, Samourai still has a great design. The interface is simple, and you’re able to perform a good amount of functions via SMS texts.
Each time you receive bitcoin, the wallet produces a new address to prevent someone tracking your purchase habits. Samourai also notifies you when sending bitcoin to the same address multiple times in order to deter unintentional address re-use. The wallet also includes other common privacy features such as Tor and VPN support, as well as blockchain obfuscation.
To expand the anonymity to your phone, Samourai also has a stealth mode. This cool functionality hides the wallet from your home screen, launcher, app list, and recent apps. The only way to have your wallet appear is by calling a secret pin code. That’s some spy-level stuff right there.
Conclusion: If Samourai can deliver on everything they promise, this will easily be one of the best anonymous software wallets. They’ve built several layers of privacy into the product, leaving you with an easy-to-use wallet that doesn’t require additional set-up or plug-ins.
Electrum on Tails OS
Electrum was created in 2011 and is one of the most trusted software wallets in the crypto space.
Several members of the community recommend using this wallet on a Tails operating system (OS) to ensure you remain anonymous. Running this wallet on Tails routes all of your traffic through Tor – an anonymity network that makes it virtually impossible to track your activity.
You don’t need to enter any personal information to set-up an Electrum wallet.
The only feasible way someone could associate you with your transactions and wallet balances is if you broadcast the public addresses that you’re using.
Electrum also generates new addresses for each transaction until you hit the gap limit – set to 20 by default. Once you hit this limit, you’ll still be able to generate new addresses manually by typing a script into the command console. Be careful, though, as any addresses generated beyond the gap limit won’t be automatically recovered from the seed. To recover these, you need to increase the gap limit or create new addresses until the used ones are found.
If you plan to or are already using a hardware wallet, you can use it in conjunction with Electrum. The wallet supports third-party plug-ins for popular hardware wallets as well as multi-signature services.
Conclusion: Electrum is trusted by the community and gives you a high-level of anonymity.
This free wallet is a great option for users who are comfortable running alternative operating systems and using the command line. If those things intimidate you, I recommend using a simpler solution.
BitLox is a bitcoin hardware wallet with a privacy set designed to ensure your anonymity. The hardware is capable of holding over 100 wallets with the ability to create millions of addresses for each wallet. You don’t need to worry about re-using addresses with the seemingly endless amount of wallet and address combinations.
BitLox uses hidden wallets with data that are indistinguishable from random bytes to provide another layer of privacy and give you plausible deniability. The wallet also secures the signatures of your transactions with a NIST certified true random number generator. And, if necessary, you can enter an emergency PIN to wipe all user data from the device.
The Extreme Privacy Set offered by BitLox additionally includes a military-grade USB vault with the Tails OS pre-installed. With this, you can anonymously send and receive funds over the Tor network using their Tor-compatible web tool.
Conclusion: If you’re interested in a secure, private hardware wallet, BitLox is a great option. Although more expensive than its competitors (the Extreme Privacy Set is $198), the product has unique privacy features that the other hardware wallets just don’t include.
Darkwallet was designed specifically to make your bitcoin use as private as possible. Their website states that the wallet is in its first public beta, but their GitHub page claims that the product is only in alpha. Their GitHub repo also hasn’t had a commit in over a year causing me to believe that this project is dead in the water.
The wallet is only available as a Google Chrome plug-in but includes features such as multisig and escrow support. To keep your transactions as anonymous as possible, Darkwallet uses a combination of stealth payments and CoinJoin compression.
Like most other anonymous wallets, Darkwallet generates a new public address for each transaction that you make.
WARNING: Several users have reported that even though the wallet is operational, it’s full of bugs. On top of that, transactions through Darkwallet often take much longer than normal transactions on the bitcoin network.
Conclusion: I recommend against using Darkwallet. The limited information on their website and inactive GitHub page are cause for concern. The developers even state that “it’s not safe at all to use the wallet.” That’s usually not a good sign.
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