Question on Wasabi Coinjoin \ stacker news ~bitcoin

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1056 sats \ 17 comments \ @PictureRoom 20 Jan bitcoin

I'm curious about the advantages of using CoinJoin for coins purchased from exchanges.

From my understanding, CoinJoin creates multiple UTXOs. If I were to send BTC from a KYC exchange to a Wasabi Wallet, perform a CoinJoin, and then send the BTC back to the original wallet, would that improve its privacy or make it more "non-KYC"?

Additionally, what’s the proper procedure for performing a CoinJoin with coins stored in cold storage? I'm sure it is not wise to send from a cold storage, to coinjoin, and then back to the original wallet.

I realize this might be a basic question, but thanks in advance for any insights.

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146 sats \ 1 reply \ @ama 20 Jan

I think you might find interesting this article, and find answer to most of your questions on it:

Bitcoin Privacy 101: Key differences between a CoinSwap and a CoinJoin

0 sats \ 0 replies \ @PictureRoom OP 20 Jan

Perfect thank you

7 sats \ 2 replies \ @kruw 13h

From my understanding, CoinJoin creates multiple UTXOs. If I were to send BTC from a KYC exchange to a Wasabi Wallet, perform a CoinJoin, and then send the BTC back to the original wallet, would that improve its privacy or make it more "non-KYC"?

If you are sending your BTC back to the same exchange you originally got it from, then there's no reason to coinjoin it at all. They already know you have X amount of BTC since they sold it to you in the first place.

Additionally, what’s the proper procedure for performing a CoinJoin with coins stored in cold storage?

The proper procedure is to first make sure the xpub address of your cold storage wallet is never leaked to third party servers. This means running your own node EVERY TIME when using your hardware wallet with software like Trezor Suite, Electrum, or Sparrow. It isn't required to run a node for privacy when using your HWW with Wasabi since it uses BIP157/BIP158 filters for synchronization.

Second, when sending your funds from cold storage to Wasabi for coinjoin, you should use coin control to make sure your transaction does not create a change output. By creating a 1 output sweep transaction, it terminates the trail entirely once that output goes into the coinjoin tx.

126 sats \ 1 reply \ @PictureRoom OP 8h

Very clear answer, thank you I appreciate that. Very helpful.

What about the UTXO's that you are given after the coinjoin? Isn't this an issue?

0 sats \ 0 replies \ @kruw 2h

Combining your coinjoined outputs is slightly less private than spending them individually, but you generally shouldn't worry about this unless you are a huge whale. If there's still any doubt, you can remix an extra time before spending.

For the absolute maximum privacy, you can make small or medium sized payments directly inside a coinjoin. This feature is currently only available in Wasabi's RPC, the UX for the GUI is still being worked on. https://docs.wasabiwallet.io/using-wasabi/RPC.html#payincoinjoin

7 sats \ 2 replies \ @OT 23h

Don't coin join if you ever want to sell it on the exchange again. You'll likely have trouble.

You can send the coin joined UTXO back into your wallet, but make sure you send it to a new address.

0 sats \ 1 reply \ @PictureRoom OP 20h

So what would you recommend then if I did want to sell one day on an exchange?

21 sats \ 0 replies \ @OT 14h

Use an exchange that has the lightning network. Move it around between a few LN wallets or swap out onchain.

BTW, I think it will probably be ok if you use a coinjoined UTXO to open a LN channel and send sats back into an exchange that way.

7 sats \ 0 replies \ @NostrDevTeam 20 Jan

Yes, you should send to a new wallet, maybe even several (different passphrases?)

This way if you are ever obligated to provide an xpub, you don't lose privacy

7 sats \ 2 replies \ @TNStacker 20 Jan

Check this out for an LN solution.

https://darth-coin.github.io/wallets/lightning-cleaning-machine-en.html

21 sats \ 1 reply \ @PictureRoom OP 21h

Holy cow, lots of info there. Thank you

7 sats \ 0 replies \ @TNStacker 20h

Yw. It's what we do around here.

7 sats \ 4 replies \ @ama 20 Jan

You might also be interested in PayJoin, recently added to Bull wallet.

https://www.bullbitcoin.com/blog/bull-bitcoin-wallet-payjoin

0 sats \ 3 replies \ @PictureRoom OP 20 Jan

This seems like a better option, from what I can understand. Solves the problem I think with what I was saying in regards to the UTXO issue.

0 sats \ 2 replies \ @PictureRoom OP 20 Jan

@ama just realized that this is for android only. I'm an iOS user

0 sats \ 1 reply \ @ama 20 Jan

Yes, they're Canadians, and maybe they're not confortable publishing a version for the fruit phone when the crazy guy in charge of their neighbor country might decide to invade theirs?

There are desktop wallets which already implement PayJoin, and I'm sure they'll be added to other mobile wallets as well soon.

0 sats \ 0 replies \ @Bell_curve 20 Jan

that is such a great point when the deputy prime minister cunt can freeze your bank account for donating to truck drivers