Also CoinJoin
Discussion
Coinjoin is useless when it comes to KYC.
The KYC process identifies you so that specific transactions can be bound to you. Making a Coinjoin doesn’t delete the Database of the exchange. They will always know that you have bought Bitcoin.
A normal transaction is enough, because no one can tell if it’s your address or not. When you tell someone you habe sold the sats p2p no one can prove the information is right or wrong.
A Coinjoin disconnects transactions from each other. That’s good for privacy but not for KYC. You have given your privacy away with the registration.
I would say a normal transaction is much better than a coinjoin when it comes to breaking a KYC link.
A normal transaction is not suspicious, a coinjoin is. But that’s just my point of view
Depends whether you believe in proof or reasonable doubt.
In a system of proof, CoinJoin removes proof of ownership.
In a system of reasonable doubt, then it is reasonable to assume that you control the equivalent value of coins that participated in a CoinJoin.
Your points are valid. I definitely agree that your purchase at a CEX with KYC links your ID with the certain TX forever.
It’s a little more complicated with TXs afterwards when you either (1) withdraw bitcoin to *your* another address, (2) coinjoin , (3) send bitcoin to * other* persons address.
The consequences of those actions depend on how the government or other entities interpret it.
Some govs will punish coinjoins, some govs will consider every withdrawal as if you send to your own address, some govs will not care at all (like in Portugal).
So, your location and your citizenship matters a lot.
That’s exactly what I wanted to say
At the end of the day, the govs want taxes from the taxable events.
Consider that scenario:
You purchased your BTC for X and then withdrew it to your another address when the BTC price was Y.
If you withdraw to YOUR address, then this event is not taxable. But you will need to PROVE to the taxman that this is YOUR address you withdrew to. If you can’t prove it, then it will be viewed as a taxable event and you need to pay.
So, most probably the govs will just prohibit the withdrawals to the non KYC address and we will have two types of addresses - KYC and non KYC.