Using Tor with a crypto wallet

Running a crypto wallet through Tor adds a layer of network privacy that is easy to overlook. Your wallet connects to the blockchain network and that connection carries your IP address by default. Routing through Tor removes it from the equation.

Why IP matters for crypto wallets

When you broadcast a transaction from your wallet, it connects to network nodes that log incoming connections with timestamps and IP addresses. This does not break transaction privacy directly, but it does create a record that associates your IP with a specific transaction at a specific time. If your IP can be linked to your identity through ISP records or other means, this association becomes part of a potential trail.

Wallets with native Tor support

Wasabi Wallet routes all connections through Tor by default — no configuration required. Electrum has a built-in proxy setting for Tor; you set it to SOCKS5 at 127.0.0.1:9050 in the preferences and all connections route through Tor automatically once the Tor Browser (or Tor daemon) is running. Monero's GUI wallet also supports Tor through the same proxy mechanism.

What it does not protect

Tor hides your network location from the nodes your wallet connects to. It does not change the on-chain transaction data, which is public regardless of how the transaction was broadcast. It also does not help if your wallet is on a device that is otherwise identifying itself through other means. Think of it as one layer in a broader approach rather than a complete solution on its own.

The setup is simple: install Tor Browser (which starts a Tor daemon at localhost:9050), configure your wallet to proxy through that port. Add it to your wallet setup the first time and you never need to think about it again. The performance overhead is minor — connections are slower but not unusably so for the occasional vendor payment.