Cryptocurrency mixers, otherwise known as ‘tumblers,’ enable users to enhance the privacy of their digital asset transactions. Crypto mixers make it more difficult for third parties to trace a user’s activity by obfuscating the transaction history and breaking up large transactions into smaller ones.
What is cryptocurrency mixing?
At its core, crypto mixing is exchanging one cryptocurrency for another to make the source untraceable. It works by combining multiple transactions and sending them through randomly selected addresses to confuse any potential tracking efforts by hackers or other malicious actors. As a result, it is much harder to trace where the money came from or who sent it.
How does a cryptocurrency mixer work?
Cryptocurrency mixers are typically web-based services that use technology and cryptography to ensure anonymity. When you send coins to the mixer service, they pass them through a series of randomized addresses before finally sending them to your destination address. This mixing makes it harder for anyone trying to track the source of the funds as they have to identify each transaction to trace it back.
In other words, when employing this service, users transfer their cryptocurrency to the mixing service, combining it with other users before moving the resulting mixed currency to the desired address. To further obfuscate the trails left by these transactions, the mixer chooses the payment amounts randomly, breaking up payments into many small parcels spanning a longer timeline. Such services are not free, however, as fees ranging from 0.25-3% are charged for each mixing session to cover operational costs.
Dirty crypto
When utilizing a crypto mixing service, users must be aware of the possibility of receiving ‘dirty’ crypto from other users. As a result, law enforcement could trace illicit activities back to them by tracing the funds. Similarly, criminals frequently use mixing services for money laundering, an illegal practice in multiple countries under anti-structuring laws. Hence, it is paramount for individuals to understand any legal ramifications before transferring or receiving cryptocurrency funds from another user.
Benefits of using a crypto mixer
Using a crypto mixer has numerous advantages over simply sending coins directly from one wallet to another:
• Improved privacy: By obfuscating your transactions, you can protect your financial activity from prying eyes.
• Anonymity: A crypto mixer can help you maintain anonymity by making it difficult to trace where the money came from or who sent it.
• Better security: A crypto mixer can secure your funds from potential hackers or malicious actors by breaking up large transactions into smaller ones.
Factors to consider when choosing a crypto mixer/ tumbler
When researching for a crypto mixer/ tumbler, there are certain factors that you should keep in mind to ensure safe and reliable transactions.
• Reputation: Look for services with good reviews from experienced users and an established history of successful mixings.
• Transparency: Ensure that the service operates transparently and provides information on the fees charged, how long it takes to complete a transaction, etc.
• Security features: Ensure the mixer has robust security measures, such as strong encryption protocols, multi-signature support, etc., to protect your funds.
• Support: Check if they provide customer service via email or other channels in case you face any issues while using the service.
• Privacy policies: Ensure that the service follows privacy policies to protect your data and transactions.
• Cost: Compare different services to find one that offers competitive fees for mixing.
Popular crypto mixers in the market
Unijoin
Unijoin is a reliable Bitcoin tumbler that is popular among novices and experts. With Unijoin, all transactions are secure, meaning VPNs are unnecessary. Additionally, the user interface presents users with an easy-to-use platform to accommodate various payment methods, such as donations.
To ensure privacy is maintained and users’ transactions are untraceable, Unijoin assigns each user a mixing code so they can track the progression of the mixing process. Furthermore, to prevent any suspicious patterns from occurring, users can not reuse these mixing codes for any purpose.
Sinbird.io
Sinbird is one of the most reliable Bitcoin mixers on the market today. Its no-logs policy erases all data related to your transactions once the mixing process completes within an hour following completion.
For further peace of mind, Sinbad offers a Guarantee letter as added protection should any issues arise. The letter protects you as an owner of BTC by proving your ownership and allowing service support to resolve any problems quickly. Sinbad can guarantee safe and private transactions as a secure and trusted digital currency mixer.
Coinmixer.se
Coinmixer is another popular crypto mixer that provides users with a secure and anonymous way to mix their coins. It supports a variety of currencies, including Bitcoin, Ethereum, Litecoin, and Dash.
It also has an advanced security system that protects users’ funds from malicious actors. It also offers competitive fees and fast processing speeds.
Cryptomixer
Cryptomixer utilizes unique mixing algorithms, making preserving anonymity easy and more secure on mobile and desktop platforms.
Their service fee is cost-effective, 0.5% plus 0.005 BTC, with a minimum transaction amount of just 0.001BTC—a great value compared to similar services. Furthermore, Cryptomixer allows users to customize their transactions further by adjusting procedure delays and coin distribution percentages according to their preferences. At the same time, a reserve of 2000BTC makes it possible to mix even large amounts should the need arise.
Blender
Blender emphasizes customers’ privacy and reserves, setting it apart from other bitcoin mixers. It requires three confirmations to send funds and a unique mixing code guaranteeing that user bitcoins are secure. With no action logs stored by the mixer, customers can rest assured their transactions are genuinely private.
Blender charges are minimal, with rates starting at 0.5% and going up to 2.5% plus 0.0003 BTC per destination address. It supports transactions of as little as 0.001 BTC, and users have 24 hours to complete their deposit, as the assigned address is only valid for that period. In addition, Blender supports SegWit and bech32 addresses allowing customers to get more features while using the service.
Blindmixer
Blindmixer is a highly closed mixing system, making it an ideal platform for those interested in anonymity. To use it, clients must create a wallet, obligating them to place their trust in the system. In addition, to ensure confidentiality and further protect their users’ information, Blindmixer implements Schnorr technology to secure Bitcoin transactions. However, there is a disadvantage in that the blending process is “blind”; this poses the risk of receiving back part of one’s funds from the mix.
The war against crypto mixers and tumblers
Law enforcement agencies worldwide have been trying to crack down on crypto-mixing services by attempting to trace suspicious transactions back to their origins. In addition, governments are taking steps to prevent the use of these services for money laundering and other criminal activities through extensive regulation. As a result, mixers and tumblers get heavy fines or even criminal charges for facilitating illicit activities.
- In May 2019, the Dutch Fiscal Information and Investigation Service (FIOD) teamed up with Europol and Monaco authorities to seize six servers belonging to Bestmixer.io, a blockchain mixer service for Bitcoin, Bitcoin Cash, and Litecoin. This action kicked off suspicion that Bestmixer used the service for money laundering purposes.
- In October 2020, FinCEN, the United States government agency responsible for preventing money laundering and other financial crimes, imposed a $60 million civil money penalty on the operators of two Bitcoin mixers, Helix and Coin Ninja. These services had operated as unregistered Money Services Businesses (MSBs) during their tenure, violating federal laws that aim to prevent illegal financing activities.
- In August 2021, the operator behind the illicit cryptocurrency bitcoin mixer known as Helix was taken to court and pleaded guilty to a money laundering conspiracy. Per their plea agreement, the charged party agreed to forfeit over 4,400 bitcoin valued at more than $200 million.
- In May 2022, the U.S. Treasury’s Office of Foreign Assets Control (OFAC) issued its first-ever sanctions targeting crypto mixing service, Blender.io due to its association with the North Korean-driven hack of DeFi protocol Ronin Bridge, linked to Axie Infinity.
- In August 2022, OFAC imposed sanctions on the popular Ethereum mixer, Tornado Cash, in response to suspicious transactions involving funds stolen by North Korean-linked hackers during their attacks on the Ronin and Harmony bridges.
Conclusion
Cryptocurrency mixers and tumblers are becoming increasingly popular to obscure transactions, providing greater privacy and security. They are also the target of intense scrutiny by law enforcement agencies who want to prevent their use for money laundering and other illicit activities. Crypto users must remain aware of the benefits and drawbacks of these services before using them. Understanding current regulations and laws related to cryptocurrency mixing services can help users make more informed decisions.
It is also crucial for users to select a mixer from a reputable provider to ensure the highest degree of transaction anonymity.
