^{Disclaimer: This post was written with the help of AI and is a reminder for myself if a hardfork occurs} (#1477958)

When a hard fork occurs, all your UTXOs are duplicated on the new chain. How you handle the forked coins can compromise your privacy on Bitcoin. This post explains the risk and how to avoid it.

What to doWhat to do

1. Don't combine UTXOs on the forked chain that you keep separate on Bitcoin
2. Move your BTC first — spend or CoinJoin before touching forked coins
3. Handle each UTXO individually on the forked chain
4. Consider whether selling / moving is worth the privacy cost, especially for small amounts

WhyWhy

Combining multiple UTXOs in a single transaction on the forked chain proves they belong to the same person. That fact applies to both chains equally. Chain analysis firms monitor forked chains for exactly this reason.

Detailed explanationDetailed explanation

The core problemThe core problem

Assume you hold three separate UTXOs on Bitcoin:

UTXO A → received from a KYC exchange (linked to your identity)
UTXO B → received from a CoinJoin
UTXO C → received via a P2P trade

After a fork, you sell the forked coins by sweeping all three into one transaction:

Forked A ─┐
Forked B ─┼──→ exchange
Forked C ─┘

This reveals that A, B, and C share the same owner. Since A is tied to your identity, B and C are now too. The CoinJoin on B is effectively undone. The unlinkability of C is gone.

Timing attacksTiming attacks

If you move a UTXO on Bitcoin and then move the same UTXO on the forked chain shortly after, the timing correlation alone can link those transactions. An observer sees two transactions from the same address on different chains within minutes — a strong signal that the same person controls both.

This applies even if the transactions themselves look clean. If you consistently move UTXOs on both chains in close time proximity, the pattern becomes even more obvious.

Mitigation:

• Wait a significant amount of time between acting on one chain and the other
• Don't follow predictable patterns (e.g. always moving forked coins right after BTC)
• Randomize the order and timing of your transactions

What gets exposedWhat gets exposed

Spending on the forked chain can reveal:

• Which addresses belong to the same wallet
• Your wallet's change detection pattern
• Activity timing that can be correlated across chains
• The full scope of your holdings

How to protect yourselfHow to protect yourself

• Before a fork: Know which UTXOs you hold and how they relate to each other
• After a fork: Move your BTC first so the transaction graphs diverge
• On the forked chain: One UTXO per transaction, separate destinations
• Timing: Space out transactions across chains, avoid predictable patterns
• General rule: Apply the same UTXO separation on the forked chain that you maintain on Bitcoin

The forked chain shares your complete UTXO history. Any information you leak there applies to Bitcoin as well. Handle accordingly.