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Which one collects the absolute least amount of info about/from me?
The one that you do not give any information about you. Anything that touches internet is not private anymore. I don't know why people are looking for privacy on internet when in fact is a PUBLIC space that offer almost 0 privacy. If you want something to be private, do it in private, not in public.
If you still want to protect your REAL you, the living man, then don't use any information about that identity on internet. Use a decoy.
So even if I would use a custodial account, I would not use it with real info, just a dummy one. Is a decoy anyways. Let's say Darthcoin is spending on weed using a custodial Alby account. I really don't give a shit, Darthcoin exist only in virtual space. Virtual means it doesn't exist in reality.
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is a decoy set up just essentially a new wallet, new email address etc and separate activities from a main wallet, or are there some other levels?
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Is up to you how you manage them. Important is that you never use your real identity.
Let me explain a bit what is "decoy wallet":
  • it is a temporary repository of funds, you never keep your funds there for long time.
  • it is a temporary deposit when you receive sats, from buying, tips, sells etc, so you will not reveal your real holding wallets or any other cache wallet.
  • it is a temporary level where you are doing the coin control, management of funds
  • it is a temporary "cache" place in case you need to rebalance channels, move funds in/out from channels, without using an UTXO (that could reveal your wallets).
Mastering BTC LN wallets require time and knowledge.
Always have in mind this simple chart of the 3 levels stash: hold, cache, spend (LN)
Now think again: where you will locate these "decoy wallets" in this image?
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this brings up a question I was going to ask today actually
so I have the majority of stacking from kyc, at some point, say I want to pay for something larger (since I view this as my savings ), I know if I just move off-chain it is easy to link back to the storage stack.
so to obscure this source and reduce any snooping from a merchant for example, i would send to a fresh hot wallet, then do like a boltz swap to lightning into a fresh LN wallet and then send the merchant?
future buys are non kyc and i think i can follow along
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this brings up a question I was going to ask today actually
Ask more questions like these. Are good and other stackers can learn from them.
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Basically something like that, you get it right. Now come up something more about common sense:
  • if you pay a regular merchant, a grocery shop for example, over LN, your privacy is very good, so you can send from your self-custodial LN nodes / wallets.
  • if you pay a merchant using onchain, then yes, is better to use a "cache" intermediary wallet, not directly from your holdings. Also using a specific UTXO for that payment. For example you will not use a holding UTXO of 1M sats to pay 50k sats to a grocery shop. because in this way you reveal that big UTXO and also the change UTXO where it goes the rest of the sats.
  • if you send the sats to a place where is involved your real identity, then always use a decoy wallet. Also if you pay a drug dealer using onchain, be careful not to reveal your UTXOs, better use LN.
Govs will trace your UTXOs only when you sell your sats on KYC exchanges. They do not care too much what you do with it. If you never sell or do stupid shit, there's nothing to worry about your KYC stash. Nobody from a gov could come and say "hey you have x amount of stash bought with KYC from x exchange". Is not their damn business and they cannot do anything about. They cannot take your sats, they can catch you only when you sell back for fiat.
You practically can accumulate sats slowly in any custodial LN account and when you have a decent amount, swap it out into a nice UTXO in your cold storage. The custodial accounts can act like decoy wallets, like a buffer zone.
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ok, so follow up on this, when you say 'use a specific utxo' - for example, I want to buy something that costs say the equivalent of 5k dollars.
now say i have 1 btc in a stash (i wish!)
so to avoid revealing the amount in the master stash - I would send the equivalent of 5k to a new address I control, thus consolidating the utxo and making the payment from there?
is that the essence of using a specific utxo? or is there something else.
  1. follow up on decent amounts for utxo - Matther Kratter i think says he likes to consolidate at 1 mil sats as that is a number that will be future save in a high fee environment.
do you think this is too high and we can do smaller consolidations without worrying too much?
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Here is a simple chart to understand the amount on UTXOs for a future use.
Yes, in general you get it right, using a cache / buffer zone where you manage your funds. As I explained in this guide, in details - THINK like a bank: https://darth-coin.github.io/beginner/be-your-own-bank-en.html
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this is a very handy visualization actually, 1 mil does seem like a reasonable sweetspot
I would send the equivalent of 5k to a new address I control,
Please try to talk only in sats or BTC. fiat/USD is not relevant when you talk about Bitcoin. What does it mean $5k in BTC today is not relevant in 10 years. Once you understand how Bitcoin works, you will see that I am right, fiat is not relevant. You do not open a LN channel with USD, but with sats.
"sats" is when you talk about payments over LN "BTC" is when you talk about transfers onchain.
Make the difference: payments and transfers. Are not the same. Onchain is the final settlement and is using "transfers" of ownership of UTXOs. LN is the payment network for Bitcoin and is using "payments", moving sats from one channel to another.
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