Difference(s) Between Anonymity and Privacy

I’ve been told the difference between privacy and anonymity in Bitcoin is: Anonymity = untrackable and Prvacy = undisclosed but trackable. Can you elaborate on the details of each of these meanings? For instance, trackable by whom? And undisclosed to whom? HOW is it tracked? etc

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Difference(s) Between Anonymity and Privacy

Anonymity Privacy Pseudo-Anonymity Bitcoin

Anonymity and Privacy


-describes situations where the acting person’s/objects/places name is unknown


-ability of an individual to sucludes them or information about them and thereby express them selectively

Anonymity and Prvacy

Anonymity = untrackable by EVERYBODY

Prvacy = undisclosed but trackable at EVERY transaction.

Anonymity vs Privacy

Anonymity is traceless and keeps the user faceless (without an identity).

Privacy allows the user to pick and choose what is being shared, but the user is not necessarily trying to be “faceless”. This gives the user the ability to own and control their data more and to even be given something in return for giving information about themselves that they might otherwise want to keep private. Think about this as being more transparent for users and application hosts. When using an app on your phone that is “free” through Google Play, you are trading so much data about yourself, most of which you are not even aware of. For example, you do not have privacy when constantly being monitored by Facebook.

Anonymity vs Privacy in Bitcoin.

Some background.

Very simply coins in Bitcoin are a immutable publicly accessible unencrypted chain of digital signatures showing amongst other things

  1. INPUTS - showing the old digital signature/s used to spend this coin
  2. OUTPUTS / UTXOs - showing the new digital signature/s required to spend this coin

These digital signatures require keypairs whose ownership can then be linked to a identity or person(s).

This link is not needed for Bitcoin to technically work i.e a user could be private forever on Bitcoin. With minimal / zero key pair reuse, hiding of public keys and growth of transaction volume on the network this privacy is significantly enhanced.

However usually this link exists but is not available publicly and managed separately from the Bitcoin network example when you use a off or on ramp for fiat and have to go through AML and KYC processes.

For full anonymity the transaction history stored publicly and in a unencrypted form cannot exist.

Therefore anonymity in Bitcoin is not possible due to how the system works.

There have been attempts at anonymity in the form of coin mixing services and modification of the bitcoin protocol. However these are illegal and have real world consequences.

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