Buy crypto anonymously on the Incognito pDEX   

How anonymous am I?

#1

Hello!
Buying crypto anonymously with FIAT is not a super easy task, I know there is Bisq (not many people there), LocalBitcoin, and other similar platforms. Things get even harder if you’re not based in US or Europe (like myself). So, centralized exchanges have their charms, as they make buying crypto an easy process, but I know, I’m not anonymous there.

So here are a few questions, if you can list the answers like I’m listing the question, I’d really appreciate.

1 - What if I use an exchange to buy XMR, and only XMR, and never convert it into anything else? The exchange has the records of how much I bought, but XMR says it totally anonymous, how does that work?

2 - What if I buy XMR in an exchange and send it to Incognito? Do I have to take one extra step, like converting it into something else, or send it to another wallet to make myself anonymous? How anonymous is this?

3 - Is there a way to buy crypto (and which should I buy) in an exchange and be anonymous? What level of anonymity can I get? I mean, they know I deposit a certain amount in the exchange, but can they know what I did after that?

Thank you for the time you took to read my question.

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#2

Very interesting questions.
I have refused to use ANY central exchange that requires KYC! I use to buy BTC with Local BTC via bank accounts, but in OZ that has been made impossible! Now it is cash only in a public venue!
1/ You can shield your Monero here at Incognito, No problem there, Even earn a bit ontop! The question that comes to my mind is, what happens when the Government wants to know: what happened to those Coins you bought from XYZ exchange?
This is why I absolutely refuse anything that requires KYC!

I started mining in 2010, and now only mine Monero, so I have avoided the problem you are now confronted with!

2/ Plenty of How2s in the Tutorials here.

Interested to hear other opinions.

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#3

Hi @Ravf,

Hope the followings answer your questions.

  1. Pretty much all the centralized exchanges in the wild will generate a private key for you when you create an account. Sometimes, they don’t even let you know your private key (e.g, Binance). Plus every time you make a transaction, either in or out, the exchanges will record it in their database. As a result, they know every single transaction of yours. On the other hand, the XMR chain itself does not have your private key, therefore, it is impossible to trace your transactions.

  2. If you buy XMRs from a centralized exchange and send them to Incognito, the process will be like this.

  • The transaction from the centralized exchange to the Incognito network is known to the exchange since it knows your private key.
  • Incognito will mint the same amount of XMR for you inside the Incognito network. The minted amount will be 1:1 and you can withdraw it to the public chain any time if you want.
  • If you convert the XMR to another token inside Incognito, it will also be publicly visible since this type of transaction is non-private. The Incognito app addresses this issue by creating a temporary address to make the trade. With privacy V2 coming in the next few months, this problem will be completely addressed. As for know, if you make the trade yourself (without using the Incognito app), make sure to use a temporary address to boost up your privacy.
  • If you unshield XMRs to the same address when you shielded, the centralized exchange will know. We recommend you unshield to another wallet, or unshield with another token to make it autonomous. The unshield transaction will be visible by two parties: Incognito and the centralized exchange. Note that the XMR itself will not be able to know the transaction sent to you, since it does know your private key.
  1. There are many decentralized exchanges out there that support buying XMRs without KYC. Have a look at some of them here.
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#4

Thank you @Andogen.
Seems like I rather risk it, giving away the information of my first purchase in a centralized exchange and then using incognito afterwards, or, trust P2P and Face2Face transactions.

1 Like
#5

Thanks @daniel
Love it when people give long explanations, we never know how much knowledge the other end has, and it’s sure good for others who come to read these posts.
I’ll take a look in the links you provided.

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