Follow up question since you know a lot
Pure hypothetical:
If I would have accumulated 1full coin over kyc and non kyc road but I already mixed some utxos so it’s compromised.
Would it be best to combine all utxos into 1 UTXO of 1BTC. Put them through a mixer a few times, splits them into for example 0.5, 0.2 and 3 times 0.1 utxos
Then send them back to my wallet and never consolidate with new KYC utxos?
That’s my thought now
There's no need to consolidate them into a single UTXO before using a mixer. For future privacy, opting for three or more mixes is recommended. Afterward, designate these UTXOs as "mixed" and label upcoming ones as "kyc" or "non-kyc" for straightforward privacy management in any transaction.
However, it's essential to note that regulators frown upon mixers. In the US, certain centralized exchanges flag UTXOs from mixers, and Chainanalysis scrutinizes your last three hops for this. This can be circumvented by conducting three transactions before sending to such exchanges. In the EU, a new law by the end of the year may label self-custody and mixers as "risky," requiring proof of fund origin. Regularly exporting your buy history from an exchange is crucial.
Nevertheless, these considerations become irrelevant if your intention is not to sell on a centralized exchange. Peer-to-peer selling remains a viable option.
But why would you sell hardest asset known to mankind for toilet paper anyway? 😊
With that being said, as long as you can prove that you purchased an equal or greater amount of Bitcoin than you intend to sell, I don't foresee any issues. You'll be able to establish the origin of funds even after undergoing the mixing process.
One last thing. If not urgent, perform mixing and consolidation during low fee environment.
