Coin Mixers - Bitcoin Mixing Services

Bitcoin and Anonymity

Its a common misconception especially in main stream media that Bitcoin and Bitcoin related transactions are anonymous. This same misconception holds true for other popular cryptocurrencies like Ethereum. Bitcoin cannot be considered anonymous because every transaction is recorded on the blockhain and viewable by all. In the case if someone knows your public wallet id, they can see all your past and future transaction detail.

90% of cryptocurrency users use a centralized exchange where KYC is mandated which means any transactions from accounts belonging to such exchanges can be linked to real world entities.

Transactions are pseudo-anonymous

Standard Bitcoin Transactions are pseudo-anonymous as your real-word identity is not stored on the blockchain but all transactions and holdings in your wallet are public and not anonymous

Bitcoin or Crypto Mixer Services

Since many Bitcoin or Cryptocurrency users would like to have more privacy on their crypto currency transcactions, there are mixing services that allows them to achive this.

Bitcoin/Crypto Mixing services combine currencies and transactions from multiple users and hide the origin and desitnation of the original coins thus anonymizing the individual users cryptocurrency transactions.

To use a cryptocurrency mixing service, a user needs to send the funds that they are tranfering to a mixer, the mixer then combines with the mixer's own reserves and other user's fund. This makes it diffcult for others to track the origin or destination of the transaction. The mixer service generally charges a 'percentage' of the transaction amount as commission.

Are Crytpocurrency or Bitcoin Mixing services legal ?

Crypto Mixing services are so far not illegal in most places but various government authorities have started cracking down on them. Also various money laundering services will flag your wallet if it has interacted with a mixer service

In August 2022, the United States Treausary Department sanctioned Tornado Cash after discovering that North Korea based hackers had used the service to anonymize stolen funds.

In March 2023, in a joint operation by Europol, German, America and Swizz authorties had seized the mixer service "Chipmixer" for money laundering and identity theft.

Alternatives to Crytpo and Bitcoin Mixing service

Not a direct alternative but if privacy is major requirement, then users should use a "privacy first" Cryptocurrency like Monero