Bitcoin, widely known as the first decentralized cryptocurrency, offers pseudonymous transactions recorded on a public blockchain. However, the transparency of its blockchain creates significant privacy risks, as transactions can be traced and linked, potentially compromising user anonymity. Bitcoin wallets play a pivotal role in determining the level of anonymity available to users. This research explores the anonymity techniques employed by Bitcoin wallets, with a focus on strategies used to enhance user anonymity. We examine the privacy features of various Bitcoin wallets, such as electrum and wasabi wallets. The Bitcoin Testnet is used for experimental purposes. The paper assesses the effectiveness of these techniques in reducing risks such as address reuse, transaction linkage. Additionally, it talks about the challenges faced by wallet developers in balancing anonymity with usability. Our research shows even though the current ways to stay anonymous make things more private, they're not perfect. It’s necessary for further innovations in wallet design to achieve robust anonymity in Bitcoin transactions. |
