Big Barry Bitcoin on Nostr: Obviously do your own research, but beyond bugs and you using compromised software or ...
Obviously do your own research, but beyond bugs and you using compromised software or not checking fees carefully etc. a coinjoin is pretty risk free.
I wanted to differentiate coin join and mixing because mixing is done behind closed doors and you give up your bitcoin to someone else for some time during the process, while coin joins make you part of the process and you never release bitcoin without simultaneously claiming the same amount of bitcoin elsewhere.
How does this work? Everyone anonymously submits inputs to go into a coin join following some rules, then create new identities, and submits their output addresses so no one knows which inputs and outputs belong to the same person, then a transaction is made and everyone needs to sign it.
Each participant only signs the transaction if it allocates the correct amount of bitcoin to them as they were expecting.
The transaction is invalid until everyone signs it so until everyone is happy, no money moves. Of course it is the software you are using that does all of that work on your behalf, so if the software is compromised, so too might be your bitcoin.
I wanted to differentiate coin join and mixing because mixing is done behind closed doors and you give up your bitcoin to someone else for some time during the process, while coin joins make you part of the process and you never release bitcoin without simultaneously claiming the same amount of bitcoin elsewhere.
How does this work? Everyone anonymously submits inputs to go into a coin join following some rules, then create new identities, and submits their output addresses so no one knows which inputs and outputs belong to the same person, then a transaction is made and everyone needs to sign it.
Each participant only signs the transaction if it allocates the correct amount of bitcoin to them as they were expecting.
The transaction is invalid until everyone signs it so until everyone is happy, no money moves. Of course it is the software you are using that does all of that work on your behalf, so if the software is compromised, so too might be your bitcoin.