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Imagine holding Bitcoin without having disclosed its gains. Typically, such a scenario would raise red flags during cash outs due to extensive chain analysis by regulatory agencies. However, when one converts Bitcoin to Monero, they can obscure the original transaction history. Initiating this "chain hop" allows for the generation of a new path for their assets, thereby minimizing the potential for tax liabilities on unreported gains.
The Mechanics of Chain Hopping
Chain hopping can be broken down into several steps:
Acquire a VPN service, ideally paid for with Monero to maintain privacy.
Utilize the Tor browser along with the VPN for enhanced anonymity.
Swap Bitcoin for Monero through a peer-to-peer method, avoiding centralized exchanges and KYC requirements.