I noticed that the BTC deposit address I was given by Incognito has already been used multiple times, by me. Doesn’t this defeat the purpose of shielding Bitcoin deposits? All of those inputs and outputs are all connected.
Bitcoin deposit address reuse
Shielding / unshielding will always be visible transactions because half of the transaction occurs on a public blockchain.
The current network protocol assigns an unique address to each Incognito account; shielding addresses are no longer rotated from a centrally managed pool.
Unless you publicly declare the shielding address as your Incognito shielding address, external analysis will likely deduce that the address is a private (non-exchange) address, that may or may not be under your control. Keep in mind, once shielded the coins associated with that address will be spent as determined by the network protocol, and firmly outside your control.
Thus while you could be identified/linked via transactions from KYC exchanges to this shielding address, transactions using the shielded coins and any eventual unshielding transaction cannot be directly linked or correlated. Indeed transactions inside the network are not traceable (no visible addresses on either side). Unshielding transactions could only be assumed through matching of coin amount and/or coin type or if you unshield to a KYC-linked address.
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Thank you. Still wrapping my head around this, will read multiple times. A couple questions.
If you send BTC to your assigned BTC Incognito address, then trade your pBTC for pXMR, what is seen on the Bitcoin network at that point?
Then if you trade back from pXMR to pBTC, then unshield the BTC, is the initial BTC Incognito address connected to the unshielded BTC address?
Wow that post is amazing. Thank you.
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