Bitcoin (BTC) is the most popular cryptocurrency, but the act of buying it makes one needlessly popular. Besides the Bitcoin blockchain, which allows the public to investigate BTC transactions and discover the identities of senders and recipients, exchanges demand customer identification (KYC) before allowing them to buy or sell BTC for other cryptocurrencies or fiat. The solution to both problems comes courtesy of PlasBit and the most private cryptocurrency: Monero (XMR). You can exchange Monero to BTC no KYC by going to the Wallet section, depositing Monero, then going into the Exchange section, choosing XMR/BTC from the pairs list, and clicking “Sell XMR for BTC.”
How to Use PlasBit Wallet to Exchange Monero to BTC
1. Log in and go to the Wallet section.
2. Deposit Monero into your Monero wallet.
3. Once you can see the Monero in your wallet, you can go to the "Exchange" section.
4. In the field "Amount to Buy," enter the amount of BTC you wish to buy. Make sure you deposited enough Monero to cover the amount.
5. Select XMR in the field "Amount to Sell."
6. Click “Buy BTC with XMR."
7. Confirm your order details and click "Submit order." The Bitcoin will appear in your wallet.
The BTC Blockchain Problem
Bitcoin rose to prominence due to relentless viral marketing that promoted the allure of fast riches and frictionless transactions. However, BTC is plagued with problems, most notably the lack of privacy, that were not apparent when Satoshi Nakamoto invented Bitcoin. At the very core of how BTC works is that all its transactions are logged on the blockchain, a public document that is updated by BTC miners. Only miners can process BTC transactions, which means updating the blockchain; it is not possible to edit the blockchain afterwards without redoing all the transactions before that one.
While it is not possible to tell who owns how much BTC outright, the fact there is a permanent public log of transactions makes it trivial to connect the dots if we know who owns a few prominent BTC wallets. Take for instance Stefan Molyneux, a Canadian writer and thinker who was banned from YouTube for his conspiracy theories. He publicly shared his BTC wallet address in order to receive donations, receiving a grand total of 1,251 BTC across 5,162 transactions. The latest outgoing transaction was on September 10, 2024, when Stefan sent $272 worth of BTC to another wallet.
All of Stefan’s BTC transactions will forever stay on the BTC blockchain. Anyone can check when Stefan received a sizable donation and how much it was in real time, as well as knowing when Stefan spent it. That might land him in serious trouble if the Canadian government decides to put an end to his shenanigans, as it did with the trucker protesters during the pandemic lockdown protests, where trucker bank accounts were seized, but anyone who donated to them was also investigated. As soon as a known bad BTC address, such as one allegedly associated with criminals, donates to one of Stefan’s wallets, he’s toast.
BTC and the Cryptocurrency Ideals
BTC gives people the hope that they will get financial freedom without having to jeopardize their privacy, but fails them on both counts. The hype that brought BTC to popularity also made it an easy target, which means it’s easier than ever to check BTC wallets and reveal hidden transactions. In fact, there’s no need to do any research on it; search engines are now indexing BTC wallet addresses and associating them with their owner’s name. All you have to do is search “Stefan Molyneux BTC address,” and you’ll get 1Fd8RuZqJNG4v56rPD1v6rgYptwnHeJRWs as the result. But, it doesn't have to be that way, because there are better cryptocurrencies out there and they align with proper ideas on privacy.
I previously wrote on cypherpunks and had the chance to see their opinion on the direction BTC was headed. Timothy C. May, the mad cypherpunk scribe, was the loudest opponent of BTC and the hype surrounding it. While he did agree it was a good thing that BTC made cryptocurrencies more popular, he thought there was too little talent in the field and too many unscrupulous people willing to exploit the gullible. Simply put, cryptocurrencies did not live up to the ideals set forth by cypherpunk predecessors, such as David Chaum, who envisioned a future where both parties to any digital transactions are anonymous but can reveal themselves and prove they were a party to the transaction if they so wanted.
David Chaum, the cypherpunk prophet, imagined things such as cryptographically secure elections and opening a bank account without providing an ID and with only a seed phrase. In Chaum’s view, there is no need to ever reveal one’s identity or personally identifiable information for the purposes of banking or voting. All of that personal information can be kept private and can be replaced by applied math, meaning encryption.
A true cryptocurrency would thus leverage encryption to become a medium of exchange that is convenient and anonymous, just like cash. While David has his idea of what that cryptocurrency should look like, which he calls eCash 2.0 and which includes bank-managed personal wallets that can be forced to spend to prevent hoarding, I have my own, and I think that’s Monero.
The History of Monero
Monero is based on a 2013 whitepaper titled “CryptoNote v 2.0” by Nicolas van Saberhagen. The whitepaper opens with an acknowledgment of Bitcoin’s role in popularizing cryptocurrencies and growing the user base of peer-to-peer digital cash, but then goes on to list its flaws, such as its rigid structure that prevents network-wide updates and the transactions being traceable. Another major flaw mentioned is the proof-of-work principle used by Bitcoin, which means that those who put in work in mining Bitcoin and processing transactions get to decide what will happen with the network.
Obviously, with the exponential increase in the power of consumer-grade hardware, a handful of BTC miners would hold the majority of processing power (called “hashrate”) and be able to decide what happens with BTC. In theory, BTC miners could decide to enforce KYC and refuse to process any transactions from non-KYC senders, turning them into banks, and if you don’t like it, make your own Bitcoin. That centralization of power is the most dangerous problem with Bitcoin, one that is only beginning to rear its ugly head.
The entire BTC system is designed to give inordinate power to miners that will only keep getting bigger as Bitcoin’s mining reward keeps halving. After some point, it won’t be worth it for miners to mine Bitcoin, which means they will exclusively fund themselves through transaction fees. All a government has to do is seize the mining hardware from the top few miners or mining pools and there goes a significant portion of the hashrate that determines transaction processing speed and network security.
Two Features of the Ideal Crypto
In any case, the Monero whitepaper states that the ideal peer-to-peer electronic cash would have two features:
- untraceability — nobody can reveal the sender
- unlinkability — nobody can reveal any two transactions were sent to the same person
Bitcoin fails the first — the BTC blockchain reveals all transactions made since Satoshi Nakamoto’s genesis block. As for the second, the whitepaper argues that BTC fails it as well, because traffic and network analysis could theoretically link wallet owners or at least reveal some personal information about them. I find that likely as well; as you’ve seen above, a cursory internet search revealed the owner of a certain high-profile BTC wallet. I’m sure it’s possible to do the same with other celebrities and their BTC wallets simply because, as cypherpunks said, information wants to be free. Once it’s on the internet, there’s no putting it back in the bottle.
Bitcoin users have developed two workarounds for both problems, but that still doesn’t solve the two fundamental problems and even adds another: trusting a third party. The first workaround is to use BTC mixers or tumblers that take in BTC from several transactions, mix it, and parcel it out so that each recipient gets the intended amount. That might slow down a determined investigator but it won’t stop him, while also creating a real possibility that the mixer or tumbler is operated by an investigator who can easily spy on the senders. I have to give credit where credit is due, because BTC mixers are an idea stemming from cypherpunks’ remailers that did the same with emails.
The second workaround is to never reuse an address. It makes sense — if one BTC wallet is always used for only one transaction, it becomes exceptionally difficult for investigators to tie identities and their transactions together. But, that is inconvenient and still doesn’t stop determined investigators, only slows them down. Besides, that means public persons can’t use BTC wallets to receive donations, which removes a big use case for the cryptocurrency.
Advantages of the Ideal Cryptocurrency
Now for the fun stuff. The whitepaper goes on to explain how a new cryptocurrency, dubbed “CryptoNote,” would deliver the two features of the ideal cryptocurrency. The first feature, untraceability, would be introduced through something called “group signature.” First proposed by David Chaum (of course), the idea behind group signatures is to establish individual signatures and group signatures so that a user can sign for the entire group. Anyone verifying their signatures can see that the user belongs to the group but cannot identify which user it is. Chaum’s original idea included establishing an authority called Group Manager that would be able to determine which user it was.
The Monero whitepaper instead uses a modified implementation of the group signature concept called “one-time ring signature.” Each user can use his private key to produce only one valid signature that can be used in one transaction. If a user tries to double spend, his private and public key will be linked together, revealing what other transactions the user has made. The whitepaper calls this unique property of the group signature “one-timeness.”
The second feature, unlinkability, comes from the fact that each Monero’s destination is a public key created by combining the destination address and some random data from the sender. Therefore, there is no address reuse and that is by design, but the sender can decide to use the same random data when sending a transaction to the same recipient, which will produce identical destination addresses. So, there is some data that indicates the sender, but he is largely anonymous unless he decides to reveal himself. That is one piece of the puzzle that explains how PlasBit does its exchange Monero to BTC no KYC magic.
Tracking Keys and Processing Partners
The whitepaper goes on to introduce another feature of this ideal cryptocurrency — transaction processing partners. A recipient of CryptoNote can designate a third party to process a transaction on his behalf, but without entrusting that third party with any private data or private keys. That is thanks to what the whitepaper calls “tracking key” that lets the partner recognize transactions intended for an address but not spend them. The idea is that transaction partners can process transactions in cases where the recipient has low processing power, such as on weak hardware.
Tracking keys are possible, because CryptoNote uses pairs of signatures for each user. Just like with the ring signature idea, the concept revolves around anyone being able to prove that a user belongs to a group of users without being able to figure out which user it is. It’s only when the user provides the other signature that he can be positively identified. The ultimate result of all those signature computations is that a recipient of CryptoNote can hide his transaction among those going to everyone else to the point that not even the sender knows more about him than a random observer.
In effect, every user of CryptoNote adds to the security of the entire network by participating in the network. It is possible that CryptoNote users can send each transaction to up to 99 other fake destinations, and because of the double spend check, the real one can still only be spent once. The increased ambiguity would naturally incur higher transaction fees to prevent network congestion.
Egalitarian Proof-of-Work and Adjustable Difficulty
Another gripe the whitepaper author has with BTC is the miner authority. The solution to power centralizing in the grasp of those who have better hardware is to avoid relying on CPU/GPU power. Compared to CPU or GPU power, memory storage is much cheaper at scale, allowing people from all walks of life to participate in the CryptoNote network without dedicated hardware or constant upgrades. Rather than using SHA-256 as Bitcoin does, the whitepaper suggests using memory-intensive encryption. The proposed algorithm would prevent miners with strong CPUs or GPUs from dominating the network by leveraging the advantages of memory over CPU/GPU processors.
Another perk of the reliance on memory over CPU/GPU power is consistent hashrate. With each Bitcoin halving, the mining difficulty increases and there is a temporary dip in hashrate as miners drop out and recalculate if it’s worth it to keep mining BTC. CryptoNote contains a targeting algorithm that adjusts the difficulty to make sure the mining keeps going at a constant rate and that the network hashrate stays stable.
Donations With XMR
The XMR community put together a simple guide on how to get donations with XMR.
- Visit GetMonero.org and make a donation address. There is no registration or KYC.
- Share the created donation address with the public.
- Spend donated Monero.
Keep in mind that turning Monero to fiat is still a hassle and you’ll have trouble finding someone willing to accept the risk. Just recently, the LocalMonero service, which allowed people from different regions to coordinate exchanging XMR to fiat, shut down and left XMR users stranded. But, that hassle has led to emerging markets for Monero, where people buy and sell Amazon, Ikea, Walmart, and Ebay gift cards for XMR. I won’t recommend any website that sells gift cards for XMR, because they wax and wane very quickly, but it’s trivial to find one. Do your research before committing your money to one.
My Opinion on Bitcoin vs. Monero
This article turned into a BTC bashfest. I didn’t intend it to be so critical or to have so much Bitcoin FUD, but I found myself unwillingly drawn to the Monero camp. It does seem a much fairer cryptocurrency and a more private one as well. The only ones who would oppose Monero would be those with a stake in the current BTC marketplace who envision Bitcoin’s price only ever going up. I imagine those would be BTC miners, who need Bitcoin to get more expensive so they can pay for their mining hardware and mining costs, and BTC speculators, who dream of Lambos.
Bitcoin has serious technical limitations baked into the network that will only get more pronounced in the coming years. Add to that the fact that governments around the world have caught wind of Bitcoin’s popularity and are eyeing the first chance they can to regulate it, making it indistinguishable from any fiat currency. Bitcoin owners are already under increasing pressure to report their BTC transactions to tax authorities. I expect that will keep spreading in the coming years, making people shift to other crypto. I think Monero is the crypto of choice, for now. It might also become too popular, leading to unwanted attention and regulation.
Monero seems like the ideal cryptocurrency to level the playing field, as it were. The only downside of Monero is that it’s not as popular as BTC, but on the other hand we’re all seeing how that popularity is playing out for BTC. As for me, my attitude on PlasBit’s services is, “I don’t know how they exchange Monero to BTC no KYC and I don’t care.” XMR is designed to shield the identities of senders and recipients using cypherpunk ideas, especially those stemming from the writings of David Chaum, but is under increasing pressure from government regulators.
I don’t use Monero and writing on it is not illegal, at least not yet. Even if it were, that’s for a court to decide, not Financial Times, and presuming I get a chance to defend myself and the penalty for writing on Monero isn’t the death penalty, I’d still be able to carry on with my life after my heinous crime of writing on XMR. Even if I were to use Monero, I’d be assured that whether I sent it to someone or whether someone sent it to me is reasonably protected from prying eyes, metadata analysis, and other ways of spying on how I live my life and who I transact with.
PlasBit and Your Privacy
As a PlasBit writer, I have no insight into the financial side of PlasBit and I have no clue how PlasBit does the whole exchange Monero to BTC no KYC thing. Based on my experience writing for PlasBit, they respect the autonomy and privacy of everyone they work with, and I’m sure they will do the same for their users on the financial side and collect only the information required by law. That seems to me the perfect attitude in the modern era in which personal information easily accumulates by accident and where it’s become easy to track people, turning every company into a potential surveillance agency.
There is a lot of stigma on Monero and anyone using it, as seen in this Financial Times article on Monero as the criminals’ cryptocurrency . I find those claims baseless at best and wretched clickbait at worst, and I think they reflect the institutions’ increasing desire to micromanage us and pry into our lives without submitting themselves to a commensurate level of micromanagement and transparency from us. Exchanges such as Kraken already had their arm twisted to ban Monero, which they did for Germany, Ireland, UK, Australia, and Belgium. But, for now, PlasBit still offers Monero and lets you exchange Monero to BTC no KYC.
