Is Coinbase anonymous?
Not Fully!
Coinbase is required by law to know who their customers are, so they are not an anonymous service.
Customers do receive addresses to receive cryptocurtencies through Coinbase, and they can also send crypto to wallets outside of Coinbase. You could send to another party without knowing their identity, or they could send to you without knowing your identity, so it’s anonymous as far as that goes. But Coinbase will know about the transactions.
Since it’s inception, Bitcoin has been thought of as an anonymous way to move money. Recently, however, a few firms have built software that can track the movement of coins and help track illicit earnings.
When creating a wallet, users are given an address that allows them to receive coins. This address is just a long string of numbers and letters, but each one is unique to the wallet. This poses privacy concerns on the network, as anyone can go in and view any transactions you’ve sent from that wallet. This Bitcoin String and letters allows people to link wallets with real word identities. For example, you send coins from your personal wallet to your exchange wallet. The wallet on the exchange could be linked to your identity. If someone knows that, then they can assume that Wallet 1 also belongs to you.
Tracking technology has more use cases than just catching criminals. With the increasing number of investors entering the scene, blockchain analysis can help banks and other financial institutions comply with KYC/AML — Know Your Customer and Anti-Money Laundering — laws. Such software could also be used to observe market trends. Increased Bitcoin trading in foreign countries, could mean pressure on national fiat currencies. It could give insight to investors long before official statements are released.
