A few times a year I go off my natural whole food diet. It usually only lasts a few days, usually around my birthday or a holiday like Thanksgiving or Xmas. But as time goes on , the longer have been eating so well, I notice how addictive the processed shit is! It’s crazy they got away with this shit for so long before so many of us woke the fuck up!

ego destroys more wealth than ignorance. the curious, humble listener still learns.

I've actually been thinking a lot about this recently. 🤔

It seems that slicing some small percentage of your portfolio that you wouldn't mind going to zero would have relatively limited downside. 💁‍♂️

I don't trust anyone else enough to do it though. 🤙

I’ve often wondered about this.. it’s nearly impossible for an external chain analysis company to follow the money surely??

Clearly this is written by an LLM but I think it conveys the key points —

Can Chainalysis track through Bitcoin Lightning after moving several hops?

Short answer: Yes, but with caveats. Chainalysis and similar blockchain analytics firms can trace activity that occurs on the Bitcoin network and can often de-anonymize some Lightning Network (LN) activity, especially when on-chain data is involved. The degree of traceability depends on how the LN channel operations interact with on-chain transactions and whether users reveal identifying information or reuse addresses.

How Lightning works at a high level

The Lightning Network is a layer-2 protocol built on top of Bitcoin to enable fast, off-chain payments.

Payments travel through a network of bidirectional payment channels between nodes.

The actual on-chain settlement (closing a channel, funding a channel) is done on the Bitcoin main chain.

Off-chain payments are routed through multiple LN nodes using hash-time-locked contracts (HTLCs) and do not require every step to be recorded on-chain.

What Chainalysis can see and infer

On-chain visibility: Chainalysis can see all Bitcoin transactions, inputs/outputs, addresses, and UTXO movements. If an on-chain transaction links to an LN channel funding or closing, that linkage can reveal associations between on-chain identities and LN activity.

LN metadata: Each LN payment involves HTLCs and potentially onion routing (Sphinx protocol) to obfuscate the destination. While the route is designed to be privacy-preserving, network-level metadata (IP addresses, timing, channel graph) can sometimes be correlated, especially if an adversary aggregates information from multiple sources (egress nodes, liquidity announcements, or multiple observers).

Endpoint exposure: If a user reuses the same on-chain address to fund multiple channels, or if a user sweeps funds to a single on-chain address, that can create traceability. Reusing multi-signature wallets or gossip data can also leak patterns over time.

Key limitations for tracing multi-hop LN payments

Off-chain privacy: The actual multi-hop LN payment path is largely off-chain, so there is no single immutable record of the path on the Bitcoin blockchain.

Route obfuscation: LN uses encrypted onion routing for payments, which makes it difficult for external observers to know the recipient or the full route.

Channel closings: When a channel is closed, the on-chain transaction can reveal the node ownership or channel funding, potentially linking participants if combined with other data.

Global correlation: Determining a link across multiple users or hops typically requires additional data (like timing, network topology, or external metadata). Without that, traceability is probabilistic rather than definitive.

Practical takeaway

If you move funds across the Lightning Network and eventually settle back on-chain, the on-chain transaction graph can reveal some associations, especially if you control or repeatedly reuse the same addresses or if there is a direct on-chain signature linking to a particular LN channel.

Across several hops, it becomes increasingly difficult to definitively trace the exact path purely from on-chain data. However, entities with broad observational capabilities (like exchanges, large clustering firms, or global metadata aggregators) can still infer relationships under certain circumstances.

For stronger privacy on LN, users typically:

Avoid reusing on-chain addresses for multiple channels.

Use fresh addresses for on-chain funding and closing operations.

Use privacy-preserving operational practices (e.g., avoid divulging network metadata, use privacy-centric wallets, consider CoinJoin-like on-chain privacy where appropriate, and be mindful of timing correlations).

Conclusion

Chainalysis can track and analyze Bitcoin and, to some extent, Lightning activity, especially when on-chain data is involved. However, multi-hop LN payments introduce privacy protections that make exact path reconstruction challenging. The risk of de-anonymization exists, particularly if on-chain transactions link to LN activity or if user behavior leaks identifying information. If you’re asking from a privacy/safety standpoint, the best practice is to understand both the on-chain and off-chain privacy implications and adopt cautious wallet and transaction hygiene.

You are missing that Chain Analysis companies have extensive surveillance of the lightning network and that the privacy routing in Lightning is not there yet.

Seems like you could move bitcoin through several non kyc lightning wallets cheaper than you could collaboratively mix on chain. What am I missing?