Risk of Bitcoin Addresses to be Identified from Features of Output Addresses

Abstract

Bitcoin is a digital currency that aims to offer anonymity. However, anonymity is less secure than it is believed to be because it is based on using pseudonyms for addresses. To demonstrate this weakness, we used statistics related to transaction histories and the frequency of transactions to deanonymize a set of bitcoin addresses. In this paper, we explore the fundamental properties of Bitcoin addresses based on actual Bitcoin transaction data. We propose a new method for deanonymizing Bitcoin addresses from a set of output addresses and we demonstrate that 80.5% of addresses could be identified.