The Good Tech Companies - Educational Byte: How to Make Private Transactions in Crypto?

Episode Date: June 5, 2025

This story was originally published on HackerNoon at: https://hackernoon.com/educational-byte-how-to-make-private-transactions-in-crypto. You don’t need your ID to use a crypto wallet, but the associated addresses remain in the public domain. Of course, there are several ways to avoid this. Check more stories related to web3 at: https://hackernoon.com/c/web3. You can also check exclusive content about #privacy-coin, #monero, #public-chains, #private-transactions, #crypto-privacy, #cryptocurrency-privacy, #obyte, #good-company, and more. This story was written by: @obyte. Learn more about this writer by checking @obyte's about page, and for more stories, please visit hackernoon.com. Most coins aren’t anonymous at all, but only pseudonymous. Transactions in transparent networks by default can be more public than bank account transactions. Privacy-focused wallets (like Samurai Wallet or Wasabi Wallet) help users keep transactions and balances more private.

This audio is presented by Hacker Noon, where anyone can learn anything about any technology. Educational byte. How to make private transactions in crypto. Bio byte. If you didn't know this, here it is. Cryptocurrency transactions in transparent networks by default can be more public than bank account transactions. Most coins aren't anonymous at all, but only pseudonymous. That means you don't need your ID or any personal data to open and use a wallet, but the associated addresses, acting like pseudonyms, remain in the public domain, available for anyone with internet access and a chain explorer. Private transactions in Cryptoarent the default. Details like dates, transaction amount, tokens,

senders, recipients, fees, and even insights and notes can be consulted by anyone who gets your crypto address. If they somehow link that address to your name or location, it's not that difficult, especially if you're not using a VPN, then all your financial movements are transparent. Of course, there are several techniques you can apply to avoid this. First off all, beyond cryptocurrencies themselves, you should be using some privacy tools in your device, like a virtual private network, VPN, and a privacy focused browser, such as Tor. When it comes to crypto, it depends on the ecosystem you prefer to use, private transactions

in public chains. As we mentioned above, most networks, coins, are transparent or public by default. This allows anyone to verify that the system is working correctly, no fake coins, no double spending. It builds trust without needing a bank or middleman. However, it may come at the detriment of individual privacy. In networks like Bitcoin, Ethereum, and Obyte, public by default, you'll need to apply some extra steps if you want to make private transactions.

The easiest thing to do is simply use different crypto addresses for different transactions. Most wallets and most crypto networks will let you generate as many addresses as you want, so you can change that small digital ID every time you send or receive money. This way, the public activity of that particular address can be reduced to as little as two transactions received and sent. Besides this, you can use coin-mixing tools or privacy-focused wallets, especially designed to obscure transactions. Coin mixers, like Tornado Cash or Blender.io, are external platforms that blend many users' crypto together to hide where it came from.

Privacy-focused wallets, like Samurai Wallet or Wasabi Wallet, help users keep transactions and balances more private by using features like stealth addresses or coin mixing, too. Both tools aim to make it harder to trace crypto activity on public chains, but hair legality can be an issue depending on the country. The United States, for instance, has applied sanctions to several coin mixers and arrested the founders of Samurai Wallet for supposed money laundering. After that, Wasabi Wallet proceeded to block US citizens from its platform. Using privacy coins, now, not all cryptocurrencies are transparent.

Some of them were specifically designed to be private, with complex cryptographic protocols in place. Instead of publicly showing who paid whom and how much to whom, only the parties involved will be able to see that information. Popular examples include Monero, Zcash, and Grin. They use tools like ring signatures, stealth addresses, and zero-knowledge proofs to mask data. These coins often raise concerns because of their potential misuse in illegal activities. However, privacy isn't just for criminals. Many people use privacy coins for good reasons, like donating anonymously to sensitive causes, shielding their personal finances from surveillance,

or safely making transactions in regions with strict controls. In any case, they're legal to own and use, even if some countries have banned their listing by exchanges. It's important to highlight, though, that all privacy methods and tools become moot once your coins, public or private, touch a centralized crypto exchange where identification is obligatory for all its users. Cryptocurrencies can remain private as long as the trade is exclusively peer-to-pe peer, P2P, and doesn't cross the path of any middleman. P2P trading is completely legal in most countries, too. In obit, blackbytes, GBB, a network's private currency, works just like that. Unlike public transactions on obit's DAG, blackbytes transfers are off DAG, shared exclusively P2P through encrypted

messages. This means the transaction details remain invisible to the public. Additionally, users can create custom private tokens in obite with the same off-dag design, making them ideal for secure, anonymous exchanges outside centralized exchanges, where most regulatory pressure is applied. Featured vector image by Freepik Thank you for listening to this Hacker Noon story, read by Artificial Intelligence. Visit hackernoon.com to read, write, learn and publish.