Bitcoin Payments for Tor Hidden Services: BTCPay Server Setup

Third-party payment processors (Stripe, PayPal) require identity verification and are incompatible with anonymous hidden services. BTCPay Server is self-hosted: no third party has access to your payment data, customer list, or transaction history. BTCPay supports Bitcoin (on-chain), Lightning Network (instant low-fee payments), and Monero (with additional configuration). No KYC on the operator side: BTCPay does not require the operator to verify identity with any payment company. Customer privacy: customers pay Bitcoin addresses directly without revealing identity to BTCPay (payment is pseudonymous unless on-chain data is linked to identity).

BTCPay requires: Bitcoin node (full node for maximum privacy, or Neutrino for lighter deployment), PostgreSQL database, and BTCPay Server application. Docker-based deployment: BTCPay provides docker-compose.yml for standard deployment. Hidden service modification: reverse proxy BTCPay's web interface through Tor (HiddenServicePort 80 pointing to BTCPay's local port). Configure BTCPay's External URL to be your .onion address so generated payment links use the .onion URL. Bitcoin full node over Tor: configure bitcoind with proxy=127.0.0.1:9050 to route Bitcoin network connections through Tor, preventing the full node's IP from being associated with your wallet transactions.

Lightning Network enables instant, very low fee Bitcoin payments. BTCPay includes LND (Lightning Network Daemon) integration. Lightning payments through Tor: configure LND with tor.active=1 in lnd.conf to route all Lightning connections through Tor. LND generates a .onion address for incoming Lightning connections. Connect to Lightning peers over Tor to maintain network anonymity. Practical considerations: Lightning requires inbound liquidity to receive payments (open channels with well-connected nodes). Lightning channel management is more operationally complex than on-chain Bitcoin but provides dramatically better user experience for small payments (instant confirmation, sub-cent fees).

Monero provides stronger transaction privacy than Bitcoin. BTCPay supports Monero through the BTCPay Monero plugin. Configure a Monero node (full node or remote node) and point BTCPay to it. Monero transactions through Tor: configure monerod with proxy=127.0.0.1:9050 to route Monero network connections through Tor. For maximum privacy: combine Monero's built-in privacy (ring signatures, stealth addresses, RingCT) with Tor routing. Monero's privacy is on-chain (transaction graph is opaque), while Bitcoin requires additional privacy measures (CoinJoin, Lightning). For hidden services where transaction privacy is paramount, Monero is the superior option.

Payment flow on a hidden service: customer selects item/service, hidden service generates a Bitcoin address or Lightning invoice, customer pays from their wallet, BTCPay confirms receipt and triggers order fulfillment. Customer privacy: Bitcoin addresses are fresh for each invoice (BTCPay generates unique addresses from HD wallet, preventing address reuse). Lightning invoices expire (typically 24 hours) preventing old invoice exploitation. For maximum customer privacy: accept Monero alongside Bitcoin (Monero customers have stronger transaction privacy). Display clear instructions for customers using Tor Browser to pay (some wallet apps work through Tor, some require separate Tor configuration).