It's not clear to me how to go about this.
Use a new address for EVERY payment of Bitcoins that you receive.
Say I want to meet with someone that sells an item or service, how do I pay this person without revealing your funds?
Use coin control. Spend an output that is very close in value to what you are sending.
I want to use a phone to pay, so I need to send my coins into an Android software of choice. From my research I think I could just use Electrum or mycellium.
Either is fine. For small amounts that will only be in the wallet for a short period of time, and which wouldn't be hugely upsetting to lose, you might even find an account with a custodial service could be convenient.
The question is, how to send the coins on Bitcoin Core into the portable software, in a way that when you pay from your phone you do not reveal your funds?
I want this thread to be specifically about privacy on your transactions. When you pay someone, they can just browse your address in an explorer and see how much that address holds, and potentially derive more addresses you own. This is insane. Imagine someone being able to do this with your bank account.
Use coin control. Spend only the outputs that are very close in value to what you are intending to spend in the very near future.
So what I would need to do is to mix the coins I want to spend,
Why?
1) Even if 99% of people use mixers with good intentions to just have some reasonable privacy, you never know what was sent there.
And when you spend your local currency, you never know where that has been before you received it either.
How do you avoid this? Btw this includes privacy wallets, not only mixing sites,
If you don't want to use a mixer, don't use a mixer. If you want to use a mixer and believe that Bitcoin is fungible, use a mixer. If someone comes asking about the "source" of the bitcoins, tell them you used a mixer. If use of a mixer is illegal in your jurisdiction, you need to decide how you feel about non-compliance with that law.
2) In order to send the coins into the Android software, you have to transact from Bitcoin Core,
If that's where you store your bitcoins, then yes.
into the mixer,
Only if you want to.
then into the Android software address. This is a lot wasted in fees.
It's only "wasted" if you have an alternative that is acceptable to you. Otherwise the fees aren't wasted, they are spent to accomplish your stated goal.
There is no way to save some money in this process?
There are several ways. Each with their own benefits and issues.
For example you could:
- Bring a portable computer with you that has Bitcoin Core installed on it, and avoid using Android wallet entirely
- Receive a few smaller payments directly to your Android wallet occasionally, and use those for "everyday" spending, while receiving entirely separate payments to your cold storage that you never access.
- Top off your Android wallet whenever fees are very low, so that you aren't "wasting" as much
- Have trusted friend or family member at home that can send the Bitcoins from your computer when you call them and ask them to, so you don't need to use Android
I think this makes Bitcoin so annoying to use for payments to be honest.
Coin control can be a bit of a hassle. I don't really mind it, but if you do then consider just keeping a small amount of spending money on Android all the time.
Bitcoin is great to just buy and hold, but dealing with it to transact stuff is just so inconvenient.
In my jurisdiction, I find that the biggest inconvenience is the need to keep track of every satoshi acquired and spent so I can report every single transaction when calculating my capital gains for my taxes every year.
I would really like to know how to do this.
I've already given a few suggestions. You seem like an intelligent person. I bet you can come up with a few more.
It's just for small amounts, like 200 bucks or whatnot, I just don't want to get people in trouble from mixing funds
Whether that would result in any "trouble" depends on the jurisdiction you are both in. If it's likely to be a problem, don't use a mixer.
seeing how many false positives there are on exchanges and so on.
Exactly. FALSE positives. Meaning, it doesn't really matter if you use a mixer or not. If an exchange wants to cause their customer "trouble", they're going to do it regardless.