Exchanges where you buy Bitcoin hold your information, which they may share with third parties. These third parties can use technology to track all your transactions, as Bitcoin addresses can be verified on the blockchain. This includes both addresses you receive from and send to, creating a profile of usage and addresses related to that profile (https://www.blockpliance.com). Exchanges can refuse your sats transfers for any reason (like coinbase), and if they believe you are making too many transactions, they may consider you a risky individual.
For better anonymity and to make it more difficult for both the exchange and the third-party company to which they send your information, advanced Bitcoin users recommend:
Using Small Amounts via Lightning to Transfer to Onchain (see atomic swaps below), less than $300.
Running Your Own Node:
With your own node, you can receive small transactions that are difficult to trace. Invoices created can be decoded but will only show information like the amount and the invoice’s timestamp. They will not reveal other important information since it is encrypted. Additionally, sats jump from node to node until they reach their final destination (your node). Most nodes are on an Onion network, which provides greater anonymity.
Example of Invoice:
Lnbc2m1pnrjd6epp5xg37tadmcc479dt8c3rqk9mu4p08y8a5uvdd4repy4r8zzs40y4qdqqcqzzsxqrrs0fppqhsrcf2xszcp9nu4xgxzjwx6m3qnvlvrtsp5nft6epu8wxaxytyadq95ygyqvewuhuqh4zw6wevwvufxjr0zc0qq9qyyssqtafnv4cz4uuccg8xfw0ec2lgmr9u23rg85ac86zdnkn4mkq93krn283prlthqky5ujpv8x4cecs4634uu4gcw4f57l3haur8vg6myggp7z6erh
Using Atomic Swaps:
If you want to transfer your sats from the exchange to your BTC address, which could be another wallet of our custodian (with our seed phrase, 12 or 24 words) as a Coldwallet, and you don’t want the exchange to have your final receiving address (since they can create profiles and sending addresses that can be tracked on the blockchain), you can use atomic swaps. You send sats via Lightning and receive sats via Onchain, though there is a fee for the swaps.
Recognized and Trusted Websites for These Transactions:
For example, see Boltz Exchange:
https://image.nostr.build/f95ab850a6d9255fb3ad1184833708a8fdb020cd8b7d5cf2ac2055b82216553f.jpg
https://image.nostr.build/5144c3b2fef6292426275aadb305d1e96e2f1c47e8e952a898bbb0cce50b6e94.jpg
Comment below if you find a best practice or suggestion and remember not your keys not your coins