While transactions are not traceable, it is important to realize that this scheme is centralized. If you look at the 13 steps of a payment transaction in the pa

While transactions are not traceable, it is important to realize that this scheme is centralized. If you look at the 13 steps of a payment transaction in the paper, then you'll see that at several steps you still need the cooperation of a "bank". This bank can still freeze/confiscate your account at will, or refuse to do business with you in the first place. It's also not clear why a bank would voluntarily give up the ability to trace payments. There are attempts to combine the decentralization of bitcoin with untraceability. Monero[1] is a working coin using ring signatures. Zerocash[2] is still being researched/developed. [1] http://www.monero.cc/ http://www.monero.cc/ [2] http://zerocash-project.org/ http://zerocash-project.org/