Anarchist guide to Bitcoin in the new US nanny state (100% FUD, but fun)

There have been a rather alarming dragnet of self custody wallets in the US, and I'm fearful that this behavior is likely to get much worse before it gets better. Here's a rough guide to using bitcoin in the new “unlicensed” landscape unfolding in the USA.

Background

There has been saber rattling for the last 3 years regarding this, and it seems to have picked up speed after the launch of Bitcoin ETFs, and exchange IPOs in the US. If I was to be conspiratorial, I'd say that those making commission on ETFs and crypto IPOs are trying to push self-custody customers into custodianship using the Department of Justice as a cudgel.

Here's a brief history

1. Nov. 24, 2023 – Wallet Of Satoshi (WoS) bans US IP addresses
2. Apr. 23, 2024 – LightSpark, a LN based payment processor, loses US banking
3. Apr. 24, 2024 – Samourai Wallet execs arrested by New York State
4. Apr. 25, 2024 – FBI warns US citizens that non-custodial apps will be taken down
5. Apr. 26, 2024 – Pheonix Wallet leaves the US under regulatory fears

I think this is just the beginning. I expect other wallets to start leaving app stores and banning US IPs in the ensuing months driving people into custodial services. If your on iOS, now would be a good time to look at jail breaking or moving to Android.

What can you do?

Well, if your not already running a full node, now is a damn good time to start one. The “problem” with WoS, Samouri, Pheonix, and other self-custody solutions is that they all rely on “backend” servers. DOJ can seize those backend servers making the apps basically dead weight. Luckily Satoshi saw this day coming and designed Bitcoin to be censor proof, IFF you run your own node.

Here are some good DOJ-proof bitcoin operations.

Bitcoin-Core + HWI + Hardware wallet

Also known as Sparrow, HWI is a great glueware that allows you to connect the most popular HW wallets to Bitcoin Core. There are ZERO backend dependencies, so there is nothing the DOJ can take down.

LND + Hardware wallet

Recent releases of LND allow air-gapped operation. Like many LND console solutions, it's not simple, but now would be a good time to grab the manual and start studying. This is the least dependent way to run and maintain a LN channel from a hardware wallet.

Full Naked Hot Wallets

Not recommended, but if all else fails you can just put your full bag into LND or Bitcoin-Core directly, as a fully hot wallet. I REALLY prefer to keep things behind hardware wallets, since they have good panic wipe features that SSDs do not.

TOR / VPN Through Non-US Exit Node

Since TOR still seems to work in the US, you can use it to get Wallet of Satoshi and Pheonix to work by picking non-US based exit nodes on TOR. This has the effect of a VPN. For Android you can run Orbot which will act like a VPN where you can select the country you want to exit into.

This is likely a good time to install the Tor Browser both on Desktop and Android to ensure you have access to source-code and github releases moving forward. Bitcoin and the TorProject itself host their content on Onion sites.

Move off iOS, or Jailbreak

Since iOS (to my knowledge) doesn't allow side-loads on official iOS releases, you either need to jail-break or move to Android. Jail-breaks can actually destroy iOS sandboxing, so it is not a path I recommend.

Conclusion

Yes, this is FUD, yes, this stuff will never happen, but if you have a nice collection of tinfoil hats like me, it might be a good time to start reading some manuals and starting a full node build.