This article was originally published in the privacy issue of the Bitcoin Takeover Magazine by Vlad Costea. Please read the magazine here.
We live in an era of unprecedented financial surveillance and censorship. Bank accounts of political dissidents are routinely frozen even in countries which purport to have free speech. Tech giants, payment companies, banks, and governments all share data about your every purchase, painting a complete picture of your every financial interaction. And central bank digital currencies loom right around the corner, promising an even more totalitarian control over your money than ever before.
We have alternatives. Decentralized digital currencies exist and are rapidly gaining market valuation and public acclaim. Privacy-preserving tech also exists, from alternative phone and computer operating systems to end-to-end encrypted communications, VPNs, and much more.
However, we have to face a harsh reality: almost no one uses crypto or privacy tech. Odds are that many (even most) people reading this right now use banks for the vast majority of their payments, and use completely surveilled devices. Few use privacy tech and crypto, and even fewer use both together, because they don’t know how.
Let’s change that.
I’ve been in the cryptocurrency space for 12 years now. I’ve used it for payments for at least 11, earned nothing but crypto for 9, and done it unbanked for 8. Trying to expand the usage of freedom money has been my focus for most of this time. I’ve taught many others how to significantly reduce the impact of fiat currency in their lives. Doing the same for absolute privacy maximalists is a lot harder, but I’m going to try my best anyway.
I’m going to give you a practical guide, as well as general tips, on how to live fully on cryptocurrency as your daily money while preserving the maximum amount of privacy. There is a vast, wild spectrum of different situations, geographies and jurisdictions, needs, personal situations, and more, so handling this perfectly is close to impossible. However, everyone reading this should come away with at least a few actionable steps on how to start improving your financial privacy and sovereignty. Some of you may even be able to go from living entirely on fiat to entirely on crypto, privately, without doing any extra research.
Let’s get started.
First, let’s outline exactly what we’re trying to achieve here. In descending order, we’re trying to keep all of our money that we need to live on:
In noncustodial, sovereign, uncensorable cryptocurrency, that we are able to spend directly from (without selling for fiat currency or using custodial systems/platforms to spend)
Unattached from your real-world identity by avoiding services which require your government ID whenever at all possible
From being traced and identified by other surveillance means absolutely as much as possible
Having everything in sovereign, noncustodial crypto is the most important part, because by using the fiat and banking system, there can be no sovereignty or privacy. If you use a custodial KYC service, all your wealth and financial activity is tracked and directly associated with your real identity, making anything else we do to protect our privacy in this domain essentially irrelevant. Using fully-sovereign noncustodial crypto to pay through services that require KYC is also a severe privacy compromise, but if done right this can be mitigated and limited to just this one use case. And finally, once those first two have been achieved, it’s important to avoid leaking data that would allow our privacy to be compromised, or we’ve done all that work avoiding linking our identity to our money for nothing.
It’s also extremely important to remember that PRIVACY IS NOT A BINARY! There is a massive spectrum of exactly how much data is known about us, but also of which parties are privy to this information. Privacy is limiting who knows exactly what about us and our financial activity to the least amount known by the fewest possible parties, unless we explicitly desire, and consent to, sharing that information with them. Maximizing our privacy is absolutely a win for sovereignty, even if we’re unable to achieve perfection. Don’t let the perfect be the enemy of the good; in other words, don’t let your inability to disappear like a ghost convince you to give up and surrender your privacy and sovereignty without a fight.
Now that we’ve resolved to maximize our privacy, let’s define three big threat models we have to be aware of:
The first and most obvious threat is leaking your identity and associating it with your financial transactions. The most obvious way this happens is through using KYC-requiring services, but it can happen in other ways, such as entering your full legal name when using a service, using a publicly-identified email address, using your phone number, or even using a well-known pseudonym or handle.
The device you use, especially your phone, leaks all kinds of data about your activity, including financial, through the host of apps and services which constantly spy on you. Compared to the other items on this list, device privacy is one of the trickiest to get right, and even if you use the latest, state-of-the-art privacy tech with your crypto, you can still ruin your privacy by using an insecure device.
Finally, it’s important to use privacy functionality and best practices when transacting in crypto. Even if you meticulously avoid associating purchases with your identity, and maintain excellent device privacy, if you don’t take care of your privacy on-chain, a pattern of your transactions can be observed, creating a full financial picture that can later be associated with your real identity.
Before getting started, let’s make sure you’re properly set up to make private payments.
First, make sure you have a phone number and email addresses that can’t be used to reveal your identity. These two forms of communication are almost universal, and are often required when making online purchases, so it’s imperative that you make sure they’re set up correctly. For email, use an alias service such as SimpleLogin to generate different aliases which feed back to your main email account without exposing it. When generating aliases, make sure they don’t include parts of your real name or can’t be used to easily infer who they belong to. For your phone number, use a VoIP number service like JMP.chat (which accepts cryptocurrencies including Monero) to protect your real phone number’s privacy. Some services require SMS verification from non-VoIP numbers, in which case use a single-use SMS verification service like TextVerified or JuicySMS works. Both of them also take crypto.
Second, secure your devices from privacy leaks. For your mobile device, use a privacy-respecting operating system like GrapheneOS, disable all Google-related services (or sandbox them into a separate profile), and keep tight control over which permissions you grant to which apps. For desktop, use Linux. For both, use Brave as your web browser and use a VPN. For sensitive communications (including regarding payments and sharing cryptocurrency addresses), use an encrypted messenger like Signal. This is a complex and involved topic, and for more in-depth education on it (and the previous point), I would recommend Naomi Brockwell’s work.
Third, acquire and use noncustodial, private crypto. Get self-custodial, open-source wallets which support privacy features. The exact wallets will depend on which cryptocurrencies you use. Monero and Zcash have the strongest privacy, but it can be difficult to exclusively use them due to more limited adoption among many essential services. Dash and Litecoin have the best adoption among services, and both have privacy features, but require more care to use with maximum privacy. Ideally, you’d want to use coins from there first category where you’re able, and from the second category for the rest of your spending.
For Zcash and Monero, download the Edge wallet, which supports privacy by default on both. For Dash, download the DashPay wallet, which has its built-in CoinJoin feature as well as protocol-level usernames and contact list (which act as stealth addresses). For Litecoin, use the Cake Wallet, which supports MWEB private transactions. When transacting, avoid predictable behavior such as receiving and sending the exact same amount, sending under too close or predictable timeframes, and other behavior that would cause your financial activity to stand out if observed. Note that this applies significantly less to Monero and Zcash, although it applies to all cryptocurrencies where you are entering or exiting privacy pools, centralized exchanges, or any other service that doesn’t respect your privacy. For example, if you buy $1,000 worth of Monero on Kraken, immediately withdraw it, and shortly afterwards two $500 prepaid debit cards are bought and activated, someone with access to records from both services would be able to correlate the timing and amounts.
This, once again, is a very in-depth topic, but having at least a general awareness can be helpful even for beginners. To keep it extremely simple: use your coin of choice’s privacy function, and that, combined with the two previous steps on device and phone/email privacy, should be more than enough for most consumer purchase situations.
Here is how to practically pay for your everyday goods and services with crypto. Note that I can provide some of the most statistically-useful specific examples for users, however the details of what exactly you need to use can vary by country. The basic categories and concepts, however, should apply globally.
The most important expense, yet the most difficult one to keep private, is bills. Utilities, mortgage, rent, etc. tends to already be tied to your identity (and in some countries these bills can actually be used as a form of ID), so there is very little privacy to be achieved by changing the method of payment. Crypto bill pay services typically are noncustodial, but most do require KYC. Common bill pay companies include Spritz and Zypto for the US, Swapin for Europe, Zypto for Mexico, BitcoinWell for Canada, Bitrefill for El Salvador, Unalivio for Venezuela, PayItNow for New Zealand, and Living Room of Satoshi for Australia. Keep in mind that the list of businesses around the world supporting bill pay is ever-changing, so please take care to stay current.
While using bill pay services which require KYC does significantly compromise privacy in that area, I would like to argue that it’s still a better alternative than using fiat currency. With a bank account, all your income, money, and spending is tied to your identity, whereas using a crypto bill pay solution only exposes how much you pay for certain bills and which currency you use, while still keeping your income, balance, and all other transactions private. Using a bill pay solution is the privacy equivalent of keeping a bank account that you only use for paying bills, and which only receives the exact funds to be spent in the form of cash. In terms of sovereignty however, there is no comparison between using custodial fiat and noncustodial crypto.
For fully-private ways of paying bills, you need to get more creative. For all bills can be paid with a card, you can anonymously buy a prepaid virtual card with crypto from a service like Bitrefill. In many countries this can be done without providing any identifying info. Sometimes Bitrefill and other similar services may sell vouchers to bill payment providers, as well as top-ups for mobile phone plans. Internet, and more, so be sure to check out the available options.
You can also see if whoever you’re paying your bills to (landlord, utility company, etc.) wants to accept crypto payments directly. See how to do this in the “Holy Grail” section.
When shopping privately online, first make sure that you connect using a VPN or over Tor, and that you are using information (email address, phone number, billing address) that are not tied to your identity. For buying physical goods, it may make sense to have a post box or other address that you can receive deliveries to without exposing your home address.
The most valuable tool here (once again) is Bitrefill, which sells digital gift cards to thousands of retailers worldwide, including Amazon in many different countries. The advantage of this for Amazon is that you can complete an order as normal, and at the checkout screen open a new tab, buy a gift card from Bitrefill for exactly the amount you need, then finish the order. And as mentioned earlier, Bitrefill does sell prepaid private debit cards as well. There is also a service called Monezon which allows you to buy products on Amazon with Monero by uploading your wishlist and having another user buy it on your behalf. Please not that this may introduce a degree of trust with the users you interact with.
Finally, there are more online merchants that accept cryptocurrency payments directly than physical merchants. There is no good comprehensive list of locations, however directories like Cryptwerk may have a good list of online merchants.
The best way to privately spend crypto in-person is, naturally, at merchants that accept it directly. You can visit some if you know them locally, or you can check Cryptwerk and other directories if any physical merchants are listed near you.
You can also use gift cards from services such as Bitrefill for in-person purchases. However, this usually involves keeping a balance on a gift card at places that you frequent, because of the inherent complexity and latency of purchasing under time-restricted conditions. However, if you use Dash, which has instant confirmations, with some practice you can feasibly buy a gift card in-person for the exact amount you need for a purchase quickly enough to not cause a major inconvenience to the cashier. Practice this ahead of time to make sure you have the process comfortably memorized, and have an alternative payment method ready in case something unplanned happens.
Finally, you can make in-person purchases using private prepaid debit cards purchased from Bitrefill or other similar services, if you first add them to an NFC-capable wallet like Google Pay or Apple Pay. When doing this, use an account not tied to your name that you only use for this purpose to improve your privacy. However, particularly Google is notorious for its privacy invasions on devices, and if you use a de-Googled phone such as with GrapheneOS your NFC payments from Google Wallet will not work. However, there is a workaround: set up a sandboxed profile on Graphene with Google Play Services, acquire a WearOS-compatible device (such as a watch) which supports Google Wallet, sync it to your phone, add private prepaid cards to your watch wallet, and pay using your watch. This enables you to cut out much of the tracking that Google imposes on you while still making NFC payments with private cards. This works great as a catch-all fallback that works at most merchants around the world.
As a bonus, if you’re able to access a crypto ATM operated by Bitomat, you can sell small quantities of cryptocurrency for cash without KYC or other privacy violations.
Similar to bill pay, transportation is another area where it’s difficult to achieve privacy, because travel details are tied to your identity. There are, however, many options to pay directly in cryptocurrency for all your travel needs, including Travala, Alternative Airlines, CheapAir, and more. These let you book flights, accommodation, and more without using fiat currency. Bitrefill also has gift card options at many travel options as well.
Fuel for vehicles can be tricky since many prepaid cards to not work at fuel pumps, but there are many gift card options on Bitrefill for various fuel stations. Note that sometimes large retailers, like Walmart and Sams Club in the US, can have fuel pumps, so gift cards for those stores can be used to buy fuel.
And finally, the Holy Grail of privately spending cryptocurrency is through spending it at merchants that accept it directly, as mentioned above. Where there isn’t adoption, sometimes you can make your own by convincing a merchant to accept cryptocurrency, and build your own peer-to-peer digital cash economy yourself. The best tool for small merchants is BitRequest, an open-source noncustodial merchant app that accepts a wide variety of cryptocurrencies, and can be set up in minutes. Merchants seeking a more formal solution with fiat conversion to their bank account should try IVPAY for Europe and CurPay for the US. Many other payment solutions exist, including NOWPayments. Do some basic research to see which one would fit best for the merchant in question.
When approaching merchants, remember that they want simplicity and more customers. If you can set them up with a seamless solution to accept cryptocurrency, and can make reasonable promises that doing so will bring them more customers, you’re more likely to onboard and retain them.
Privacy and sovereignty are a spectrum. How much of your private information is known, and by whom, can vary wildly, as can how much of your financial activity can be blocked or censored by whom. Achieve the most privacy and sovereignty that you’re feasibly able to.
You get more of what you patronize. By living entirely on fiat currency and surveilled tools, you are signaling to the market that there’s no demand for sovereignty and privacy. Be the change you wish to see.
Don’t be afraid to go multi-coin. These are just tools for freedom. Use what works for you, when it works, how it works, and don’t let anyone tell you that you’re doing it wrong.
We live in a time when governments and legacy financial institutions around the world are a greater threat to our freedom and privacy than ever before in recent memory, and it’s only going to get worse. Thankfully, the tools for you to live completely off of sovereign, censorship-resistant money, while maintaining full financial privacy, have never been better. Use them.
Taxation is theft.
Your phone is spying on you.
Fiat is a scam.
Live (privately) on crypto before it’s too late.
