BitPay, a popular cryptocurrency payment processor, compromises online financial anonymity in several key ways:
-
Data Collection and Sharing: BitPay collects various types of personal information from users, including names, email addresses, transaction details, and sometimes more detailed identification information such as government-issued IDs. This data can be shared with third parties, including service providers, business partners, and legal authorities.
-
Compliance with Regulations: BitPay operates in compliance with a range of US laws and regulations that mandate the collection and sharing of user data. These include:
- Know Your Customer (KYC) Regulations: BitPay is required to verify the identities of its users to prevent money laundering, fraud, and terrorist financing. This involves collecting personal information and sometimes performing detailed background checks.
- Anti-Money Laundering (AML) Laws: To comply with AML laws, BitPay must monitor transactions for suspicious activity and report certain types of transactions to authorities. This often requires extensive data collection and analysis.
- The Bank Secrecy Act (BSA): This law requires financial institutions to keep records and file reports that may be useful in detecting and preventing money laundering and other financial crimes.
- The USA PATRIOT Act: This act enhances law enforcement’s ability to combat terrorism and includes provisions that impact financial services, such as increased requirements for identity verification and transaction monitoring.
-
Implications for Anonymity: By collecting and potentially sharing this information, BitPay undermines the anonymity that is often sought by users of cryptocurrencies. Transactions processed through BitPay can be traced back to individual users, and the collected data can be accessed by various entities, including law enforcement agencies.
Admittedly, I haven’t witnessed anyone in the Monero community promoting Bitpay, especially since Bitpay does NOT accept Monero payments directly, but if you find yourself in a situation where you need to use Monero, rather than fiat, to pay for a big one-time expense, you’re considering swapping into a coin that will enable that transaction.
In summary, while BitPay provides a convenient way to use cryptocurrencies for transactions, it significantly compromises financial anonymity due to its compliance with stringent US regulations and its practices of data collection and sharing.
My own assessment of the OPSEC compromises required to complete this transaction is that it’s not worth it. I MUST accept that I will NOT be able to spend my Monero until the retailers selling what I want to buy accept Monero natively. Until then, happy HODL’ing.
No surprise. There are three main markets, (1) the white market, (2) the grey market, and (3) the black market. Anything linked to the white market is regulated. Regulations have expanded several fold since the 1980s, but that’s the hand we’re dealt and I don’t think you can find a service like BitPay or Spritz Finance without this regulation. Grey markets find loopholes to let you do what you want with far fewer or no regulations (e.g. using cash, coin cards, p2p payments with local vendors, etc). Black markets have no regulations. So if you want total privacy, you need to focus on the later two types of markets.
So, what do you recommend to use for trading Monero or making transactions? I know “instant crypto exchanges” like Exolix or Changely. At least you should not register there to make a transaction with Monero
In summary, while BitPay provides a convenient way to use cryptocurrencies for transactions, it significantly compromises financial anonymity
i.e. the cost of convenience is privacy (see modern finance, most smartphone apps, g**gle services, etc.)
retailers selling what I want to buy accept Monero natively
good luck. my hope is that atomic swaps enable convenient point of sale conversion with plausible deniability
