This text will explain what anonymity, privacy, and security are and how they could be achieved in the crypto industry. Here, you will find tips and understand why online security knowledge is crucial in an online environment. What are the differences between those three?
Privacy is achieved when a person chooses to control the extent to which they want to show or conceal personal information or activities when appearing online. This means that other participants could see who that person is, but not personal information: which websites they visit, which apps they use, and so on - depending on the level of privacy the person chooses.
An anonymous person can be a person who chooses not to reveal their real life identity despite being active online. Other users might see what the person is doing, but not who that person is. This is often the case with online forums and groups where people do not usually use their true identities, but share experiences and ideas through the use of a pseudonym or nickname.
Internet security means paying attention and protecting yourself during online activities such as visiting various sites, downloading data, registering, and logging in to different platforms. It implies security from online threats regardless of privacy and anonymity.
Achieving online security cannot happen instantly. It’s necessary to take measures and then continue further online activities by adhering to them. Of course, none of these measures are particularly complicated, but they require a routine. Certainly, the level of caution should be consistent with your online activities. The level of protection is not the same when one is looking for recipes online and when one is storing private keys on the computer.
Safety applies to everything from content downloads to online shopping. Someone on the forum, Telegram, or Discord group may know your identity and some of your personal information, but if you care about what you do in the online environment, you can be safe.
What goes on the Internet - stays on the Internet
The Internet allows free search, easy involvement in global discussion, accessible communication, sending data, downloading programs, applications, and other content. But when users' privacy and anonymity are compromised, their civil liberties are also compromised. While some shared information is harmless, some are more serious if it contains sensitive information: location, medical history, and so on.
There are two groups we should keep in mind: individuals and small groups involved in hacking, phishing and similar, and large companies and platforms which work as information gathering projects.
In the first case, the goal is personal gain in money, crypto coins, or access to valuable information that can be sold, ransomed or exchanged for money, giftcards, other valuable goods or crypto coins. In our previous text, we wrote what you could do to protect yourself from hacking or theft.
If we talk about platforms and companies, the goal is not individual or visible damage but global research and data acquisition of user behavior, emotions, patterns. Most of the data will be used to sell for advertising purposes, while the individual will receive news and information on their feed by "expectations". According to whistleblower Edward Snowden, the government collects data from all online users - and has access to data from public companies. Not only Facebook is on this list, but also other applications and services such as Google, Apple, TikTok, Instagram, Whatsapp, and many others.
"Arguing that you don't care about the right to privacy because you have nothing to hide is no different than saying you don't care about free speech because you have nothing to say." - Edward Snowden
The argument that this is ‘’not a problem for someone who has nothing to hide’’ is missing the point because it is not a matter of ‘’hiding’’ anything but of protecting. And certainly, everyone has something they would like to protect and what they find valuable. Sometimes the desire for privacy is mistakenly linked to personality disorder, lack of transparency, or even criminal activities - in any case, it’s given a highly negative connotation with no reason.
Anonymity and privacy in the online world
While some argue that people who appear behind the veil of anonymity probably behave the way they would not if they did not have the privilege of anonymity, others argue that freedom of speech is one of the individual's fundamental rights. Online violence (cyberbullying), hate speech, and similar outbursts are gaining momentum. On the other hand, people are free to express their thoughts without fear of condemnation or losing their job. Anonymity has its pros and cons, and it is up to the individual to decide how he or she will behave in the online environment.
Anonymity is always recommended when it comes to money transactions or transactions of any value. There is no need for all the observers to know who you are, how much money or crypto you are transferring. A world in which all money transactions would be under the veil of anonymity would be an excellent environment for the free sending of money and free trade. It would reduce safety risks and give people freedom. And that is precisely what some of the crypto-projects offer.
"Privacy is necessary for an open society in the electronic age" - Eric Hughes
Data privacy in the crypto world is essential, unfortunately, only a few projects deal with privacy as a serious problem and a real need for modern users. Some of them provide optional privacy, which raises the question of the validity of such a project. On the other hand, there are crypto projects that deal with privacy on a severe level, such as Safex and Monero. Privacy and anonymity are at the core of their beliefs and have a large community of supporters. More about this later.
Cyber security tips
Most readers of this text will not need to achieve anonymity, privacy, and security at the highest possible level. Still, it’s necessary to be informed about online threats and take steps toward online safety. Here is what we can do to achieve the greater security in the online environment:
- Use passwords on your computer and phone
- Use a new password for each online account
- Make sure the password is long enough and does not contain phrases that could be related to you as a user
- Do not send card information, do not lend your card to anyone
- Do not make payments with a bank card on which you keep all your money
- Don’t use someone else’s WiFi if you don’t have to
- Do not log in to devices that are not yours
- Do regular software updates
- Do not download files from suspicious sites
- Don’t use social media if you don’t need to
- Do not enter a location when using social networks
- If you have the ability, use a reliable VPN
- Use Firefox rather than Chrome
- Use Linux rather than Windows
- Use decentralized online marketplaces rather than Amazon
- Use a reliable Password Manager
- Use services that use encryption and are recognized by the community
If you’re in crypto, then pay special attention to:
- Keep your private keys and seed phrases in a safe place or in multiple locations that you personally control
- Encrypt any backups that are stored elsewhere, which you don’t maintain personal control of (eg. Bank Security Box)
- Use strong (preferably 21+ characters) passwords on crypto exchanges and wallets
- Don’t keep your coins on the exchanges if not actively trading them
- Do your own cryptocurrency research
- Always use double authentication on stock exchanges and enable email confirmation is required when withdrawing money
- Stay educated about online scams, websites, and community members promoting them - report suspicious community member behaviour to project admins.
- Do not click links sent to you by unknown members of the community or open suspicious emails
- Never, ever send private keys to anyone, even crypto exchange or a community friend, if they are asking it from you
How to achieve anonymity, privacy and security related to money transactions?
Cash is very straightforward when it comes to providing privacy and anonymity. When we pay in cash, we are always anonymous, no one asks for any personal information, no one records who bought the goods, how much money was spent, and so on. On the other hand, the bank always has insight into all transactions and account balances when we pay by card. In addition, inexperienced users of online payments can sometimes get into trouble. The serious one can be money theft, while the most common may be storing (and then selling your) private information by large centralized e-commerce companies. Online payments are increasingly used, and in some countries, they have almost completely replaced cash payments. That also means that we need to raise security awareness when paying online.
Cryptocurrencies supported by blockchain technology are the next level of online payment. Contrary to expectations, the number of cryptocurrencies that provide anonymity and privacy of data is minimal. Even bitcoin does not offer anonymity as some usually think at first. Bitcoin provides pseudo-anonymity and transparency of transactions. On the other hand, some cryptocurrencies and projects care about data privacy thanks to the additional development of blockchain.
Level 1 - Bitcoin
It is essential to remember that the bitcoin network provides pseudo-anonymity and transparency of information. In the case of bitcoin and other transparent blockchains, this information is the number of coins sent, the number of remaining coins, from where they were sent, the history of the coins, and the time of sending. All this information is visible to both the sender, the recipient of the coin, and all others who know where to look for it. On the other hand, the real identity of a person is not known to the regular user. To find out that, higher-level skills are needed, including tracking payments from this public address and linking activities and behaviors online. Even then, it is not easy to track down. Bitcoin, according to this, does not belong to the group in which cryptocurrencies provide full privacy, but it is undoubtedly the first crypto project that went in that direction.
Level 2 - Monero
Monero is the first cryptocurrency to give anonymity to users. It was created according to the bitcoin model, but it completely provides anonymity and privacy. It does this thanks to a specially designed blockchain where anonymity and privacy are built into the system. All this is possible thanks to the so-called ringCT and one-time stealth addresses. In any case, none of the random observers can see who is sending the transaction, to whom it is addressed, how many coins are being sent, and more. The downside of the monero is that its coin distribution model is the same as with bitcoin, so most coins have already been mined, and its sole purpose is to be a means of payment like most other crypto coins.
Level 3 - Safex
Like monero, safex works on a similar principle, but with a different goal. While the monero project is designed to be one of many means of payment, safex was created with the idea of being an e-commerce platform on which transactions will be under the veil of privacy and anonymity. This property was considered necessary for free trade and is one of the fundamental characteristics of this project. As the platform is decentralized, no central entity or random observer will have an insight into the identity of who purchased any goods/service item on the marketplace. In this way, the customer is protected from potential fraud and data collection, which are not uncommon in online shopping. And safex uses much the same technology as monero - all transactions are protected, users are anonymous, and their data is private. This way, everyone who buys on the Safex e-commerce platform, or just transacts directly with another person, will be anonymous, the data private, and the purchase secure.
"When using transparent cryptocurrencies such as Bitcoin, privacy is very important because our balances are displayed on the blockchain. Without a privacy mechanism, all of our financial information is available to everyone and at risk of potential theft. The best union for crypto is the one with e-commerce. To achieve that, the e-commerce platform would have to be built with a user protection mechanism, so privacy should be kept in mind" - Daniel Dabek.
Whatever payment method you choose in the online environment, please do your best to be as safe as possible, and follow the steps listed above. And don't forget, just because you have nothing to hide doesn't mean you shouldn't protect what we already have.