Bitcoin isn’t an inherently private asset/currency. While it has its benefits in terms of simplifying value transfers (especially in cross-border transfers and situations where individuals aren’t given access to “classical” means of financing), the fact of the matter is that Bitcoin still suffers to provide satisfying levels of anonymity.
The entire Bitcoin network rests on top of a corresponding blockchain, which is transparent and available to public scrutiny. Once your Bitcoin address becomes tied to your name (either by you transacting with someone in person or by you signing up to an exchange and completing its KYC requirements), all your transactions and activity become deanonymized and traceable.
Probably the highest profile case which showed us why this lack of anonymity can be problematic was the trial of Ross Ulbricht, the now-imprisoned founder and organizer of the infamous darknet website Silk Road. The website was known as a hotbed for shady and straight-up illegal online activities like drug trading.
Ulbricht eventually had the authorities trace millions of USD worth of Bitcoin payments to his personal Bitcoin address, giving them evidence that Ulbricht actively took part in these illegal activities (even though he to this day pleads his innocence). While I’m definitely not justifying Ulbricht’s actions or claiming he was fresh as a daisy in this case, there really is no way to know for certain if said Bitcoin transactions came as a result of legal or illegal activities.
What this ultimately leads to is a situation where certain Bitcoins are less fungible than others. For example, Bitcoin that was stored on Ulbricht’s address is now potentially less valuable on the open market, due to being tied closely to the darknet and illegal activities. Some traders might prefer to have “clean”, freshly minted Bitcoin, or at least one that doesn’t have a shady background story.
All things considered, a way of, let’s say “laundering”, these tainted coins, as well as allowing Bitcoin addresses that have names tied to keep their transaction activity private, is clearly required. One method of providing these benefits which has been picking up in relevance as of late is related to Bitcoin tumblers. A cryptocurrency tumbler operates on a simple premise:
- multiple people send their cryptocurrency to tumbler’s address
- all of their cryptocurrency gets “tumbled” around and mixed up to de-link the coins from the sender addresses and make them “clean”
- the original sender is sent back the amount he sent to the tumbler (this amount can be slightly smaller due to service and network fees)
And that’s about it. Going through these steps will help you disassociate any BTC you have with yours or the identity of any previous owner. The anonymization service can be additionally enhanced by using the Tor browser or by running your cryptocurrency through multiple tumblers.
Some concerns have been raised about the tumbling/mixing service potentially being used for laundering money gained through illegal activities or used for funding terrorism; while the jobs of law enforcement agencies can be made harder in these cases, the privacy benefits for the wider community heavily outweigh the negatives. The regulation is pretty clear on the matter as well: Bitcoin is considered a property and not a currency, which makes tumbling/mixing services legal and not equal to money laundering.
Another thing to consider is the fact that these tumblers are basically third party services which require you to send them your Bitcoin/cryptocurrency so that they could mix it up for you; this requires a certain degree of trust and somewhat defeats the purpose of crypto as a trustless currency of the future. Still, until native solutions are introduced, tumblers remain among the best options for improving Bitcoin privacy out there. If you are interested in trying out one, we’ll list out some of the most popular tumbling platforms that are currently available on the market.
- How to Buy Bitcoin Anonymously (without Verification or ID)
- Best Anonymous Bitcoin Exchanges – No KYC
Far superior ways to increase privacy of your bitcoin transactions is using Wasabi Wallet or Whirlpool by Samourai Wallet. Let’s take a look at them below:
Wasabi Wallet for private transactions
Wasabi works by creating trustless CoinJoin transactions over the Tor anonymity network. The CoinJoin coordinator cannot steal from, nor breach the privacy of the participants.
A CoinJoin is a special type of Bitcoin transaction where several participants get together to literally join their coins in a single transaction. These peers build a transaction where each of them sends some coins as inputs, and new addresses as outputs. The Coinjoin is an old concept formalized by the legendary bitcoin developer Greg Maxwell and has been around since the early days of Bitcoin.
The aim of CoinJoin is to gain privacy by breaking the link of which input “pays” which output so that any of the outputs cannot be attributed to the owner of the input. For this to work, it is very important that the values of the outputs are exactly equal. Wasabi enables trustless (meaning nobody can steal) and private (meaning even the coordinator cannot spy) Schnorr blind signature CoinJoin according to the ZeroLink fungibility framework.
Whirlpool by Samourai Wallet
This option works on the basis of CoinJoin as well. When cycling your coins through the Whirlpool, there are three liquidity pools to choose from, based on the total amount you are cycling and the desired number of newly cycled outputs that are created. This is a very fast service, transactions go through within minutes and not hours which is the case with big, single CoinJoin transactions.
Whirlpool charges a flat fee – meaning you end up paying less the more you mix. Other services base calculate their fees as a percentage of the transaction value which can make it very expensive for larger amounts.
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Whirlpool is built in to Samourai Wallet and available as a stand alone desktop app available on all platforms. Learn more about it here.
Now, let’s take a look at top bitcoin mixers as well.
Best 5 Bitcoin Mixers in 2021
Onion URL: http://bitmixbizymuphkc.onion/
Clearnet Link: https://bitmix.biz/
Bitmix is another mixing service which doesn’t require any registration or accounts on the platform. The interface is also quite intuitive and easy to grasp for either your average crypto beginner or a seasoned vet. You’ll be required to enter your destination address (or addresses, as you can add a total of 5 of them into a single mix), set your delay in hours, your service fee, and you’re set to have your funds mixed. The platform also provides a “mixing strength” bar which will show you how optimal is your current mixing setup; clicking on the “auto-adjust” option will give you the best possible settings, as envisioned by the platform.
The maximum delay time is 24 hours and it applies only to the initial delay. Any further distribution can be randomized or left on the “don’t randomize” setting. Users cannot control the distribution of funds, as each entered address receives a random % of the initial sum. You’ll also get a 12 symbol code which you can use to track your order. The platform’s minimum deposit is set at 0.005 BTC; the maximum is set at 2077.94 BTC. BitMix’s mixing process takes up to 24 hours, although it’s can depend on the current service load. Coins will be instantly transferred to your address after the confirmation of your transaction. Logs aren’t held by the platform and all forwarding entries are removed 72 hours after your order is completed.
Clearnet URL: https://blender.io/
Onion URL: http://blenderiocpxfema.onion/
Another mixer with a very simple and user friendly interface. You can enter the receiver’s address (or addresses), select delays for each address and a service fee which you want to pay (can go from 0.5% to 3%). The fee should be changed on repeated mixings for increased anonymity. Optionally you can enter a “mixing code” which prevents the coins sent through different transactions from mixing with each other. The mixing code is provided when you first mix your coins and can be entered on the subsequent transactions to let the platform know which coins not to mix with. The platform lets you send your coins to 10 additional addresses.
Delays on Blender.io can be set up to 24 hours and the platform will require that your transaction is confirmed at least 3 times before they clean your coins. Deposit of your dirty BTC should be made within 24 hours of making your mixing order. No logs are stored on the platform and all transaction data is deleted once the coins are sent to the receiving address. Minimum amount you need to deposit is 0.001 BTC, while the maximum is determined on the basis of available coins in the platform’s reserve. The platform supports SegWit addresses starting with the digit “3” for sending and receiving Bitcoins. Blender.io also offers API integration for businesses which receive/send cryptocurrencies on the regular.
Clearnet URL: https://bitcloak43blmhmn.com/
Onion URL: https://bitcloak43blmhmn.onion/
BitCloak is a service that is currently only available through the Tor browser interface. A darknet mixer founded in 2016, it offers both coin mixing services as well as the ability to purchase something anonymously through their interface. The difference between the two is that the Mix My Bitcoins options will allow you to send any value from where the random fee will be deducted while the Pay Anonymously option will allow you to send the exact value by allowing you to pay both the amount you want sending together with the random fee anonymously. The first option is most suitable for withdrawing from a market or cleaning all your Bitcoins while the other one should be used when paying for a product or cleaning a part of your Bitcoin holdings.
The BitCloak deepweb mixer does not require you to register an account and comes complete with a free API which give webmasters or developers the same functionalities for both the “mix” and “pay” features, which make this a good tool for a market or e-commerce website. The mixing interface offers you the industry standard: you can enter your destination address and the delay you wish to apply to your coins being sent to said address. There’s also a “max amount” box which lets you specify the max amount of funds you wish to deposit/mix. Minimum amount you can mix is 0.028 BTC; maximum amount is 25 BTC. The service fee sits around 2% while the delay can be customizable up to 8 hours, definitely one of the shorter time frames on the market.
The transactions only require one or no confirmations at all depending on the amount you’re mixing. Your mixed funds can be distributed to 10 different addresses. BitCloak also provides a deepweb escrow service which lets you handle online purchases/sales in a safer way. If you want, you can verify that the address they sent you is original by checking if the message is correctly signed. This prevents you from being phished or scammed. You can click “Check PGP proof” option to see the signed message and you can find the signature at the bottom of the page in “Public Key”.
While Helix isn’t active anymore, we felt that we should cover it as some people still seem to think they can tumble their currency with it. Helix was created in 2014 by Grams, a darknet market search engine. It had its darknet and its clearnet versions which crypto owners could use to mix up their cryptocurrency.
Grams and all of its services (including Helix) shut down somewhere around the tail end of 2017, but several copycat phishing websites surfaced soon after, looking to exploit individuals who are looking to browse the darknet or mix their Bitcoins. Users should take notice that Gram and related services are no longer active and that any links which claim to lead to the original websites are scams. Similarly, users should avoid services like Bitcoin Fog, Coinmixer, PrivCoin.io as there have been reports of foul play with all of those.
Clearnet URL: https://bitcoin-laundry.com/
Onion URL: http://btcdryi67te57itq.onion/
Bitcoin Laundry offers one of the simpler user interfaces you’ll find on the market. There’s no need for creating accounts or verifying your identity on the platform. You will be asked to provide your receiving address/addresses and enter a desired delay (can be set to up to 24 hours; alternatively you can pick a random value or set this to zero if you want to see your transaction go through instantly after one confirmation). You can send your coins to multiple addresses (10 to be precise) to increase your anonymity. You can also control the percentage of the funds will a certain address receive. Once you specify the address(es), you are given three days to send your BTC to the address provided by the website. The address can be scanned by a QR code scanner or manually entered; the page for entering the address also contains a session ID which you can use to track your session/mix. This ID should be copied as it can help you if any problems arise with the mixing process.
Minimum deposits that Bitcoin Laundry accepts are 0.0005 BTC; maximum amount of Bitcoin you can deposit is 38 BTC. The mixing fees are 0.1% of the mixed amount + 0.00008 BTC transaction fee. The platform will keep a log of your mix for 7 days but you can choose to delete it immediately if you so desire (they recommend that you should wait to have your funds arrive at the receiving addresses before deleting the logs). If something were to go wrong, the website has a support section which will do their best to solve your problem. Bitcoin Laundry is an active, legitimate platform which recently released a Spanish, German, and French version of their mixer to cover the needs of a wider, non-English speaking market. Overall, Bitcoin Laundry is a simple, community approved, active service that does what it’s supposed to do.
Clearnet URL: https://smartmix.io/
Onion URL: https://smartmixnjmuoixj.onion/
SmartMix allows you to mix your Bitcoin or Bitcoin Cash through the platform’s reserve pools. It offers a simple, easy to use interface which asks for the address to which your coin will be delivered, payment delay time, and your SmartClub code. SmartClub is a unique feature of this platform which lets users earn lifetime service fee discounts of up to 90%. To get your SmartClub code, all you need to do is sign up for the service. You can also take advantage if SmartMix’s affiliate program which lets you earn up to 50% of service fees paid by users who sign up through your referral link. That being said, the platform can be used without any account registration or unnecessary data inputs.
Users pay a service fee of 0.5 % per mix plus 0.0001 BTC / 0.00005 BCH per payout address. Minimum deposit you can make is 0.01 BTC; anything lower you deposit on the platform will be considered a donation. You can choose between fast/delayed payouts. Fast payout will start after your deposit payment has 2 confirmations. After that your mixed coins will be transferred to your payout address(es). You can also choose a delay of 5 to 30 confirmations, or a random delay of up to 30 confirmations. The funds can be distributed to additional 5 addresses however you don’t get a say in which address receives how much of your mixed funds. Logs are saved for up to 7 days, after which the data is scrubbed from the platform’s servers.
Cleannet URL: https://bitblender.io/index.html
Onion URL: http://bitblendervrfkzr.onion/
Bitcoin Blender was launched in 2014, by an anonymous Bitcoin enthusiast and software developer who felt that Bitcoin users should have the option of an extra layer of anonymity when using cryptocurrency. One of the simpler, more efficient interfaces on the market, it does what a tumbler is supposed to do. You can deposit “tainted” coins with no personal details required, no “paper trail” left behind, and absolutely no connection to you or your account.
Bitcoin Blender is a Tor hidden service that uses smart technology to erase your Bitcoin history and make your transactions 100% anonymous. Bitcoin Blender completely removes any connection you have with the coins you buy or sell, meaning nobody can use Blockchain Analysis to track you down. You can either create an account on the platform or select the “Quick Mix” option to instantly mix your coins. Simply get to the Quick-mix page, enter the withdrawal addresses you need the coins on, set time-delays, and send in your Bitcoins. The mixed Bitcoin can be distributed to as many as 10 additional addresses but you cannot control the way the funds are distributed.
The platform charges a randomized fee of 1-3% and each mix is given a special code which can be entered in the next mix to prevent coins from your two orders from mixing. Minimum deposit you can make is 0.01 BTC + the fee. Creating an account on the platform will give you features like 2FA. Logs are kept for 7 days and can be deleted sooner if the users so desires.
Clearnet URL: https://bestmixer.io/en
Onion URL: bestmixer7o57mba.onion
BestMixer exudes an aura of professionalism as soon as you open up their website. Everything on there feels slick and well optimized. Taking great pride in being recognized as one of the community’s favorite mixers, they do provide a service similar to what we saw before. When you send your coins to BestMixer.io, they are entered into a pool of coins along with those of other depositors. The platform’s mixing engine then tumbles your coins along with other coins in the pool. The coins you receive as a result are made up of bits from many different sources, thereby scrambling their origins and making them untraceable. The blockchain network’s transaction speed and the delay you choose will determine how quickly you receive the untraceable coins in your wallet.
The platform’s interface is simple yet elegant and responsive, letting you mix three types of cryptocurrency: Bitcoin, Litecoin, and Bitcoin Cash. This lineup will be expanded with Ethereum sometime in the near future. You can enter your receiving address, add additional addresses (up to 10 of them), set your service fee, your transfer delay (can delay return of your funds for 72 hours; the delay can be preset for minutes unlike other platforms). The funds need to be deposited within 24 hours of making the order.
BestMixer has an interesting feature which splits the mixed coins into three different pools. Alpha pool is the traditional pool operating under a client-to-client scheme according to which reserves for payments to new clients are formed using coins coming from other clients who have chosen the Alpha Pool. Beta Pool reserves are formed using coins from large Alpha Pool transactions, project’s private reserves, and investors’ coins. This pool has bigger reserves than the Alpha pool and is typically used for high-value transactions. Gamma pool reserves are composed of private reserve and investor coins; this pool contains coins that are guaranteed clean. This structure ensures that the platform’s Bitcoin reserves stay at industry leading levels.
The platform offers a mixing strength meter which gives you some guidelines on how to make your mixing more efficient, like entering more addresses, setting a higher service fee and increasing the transfer delay. Your first order will generate a special BestMixer code which you can use in your future transactions to ensure that you won’t get your old coins back. This same code can be used to get special discounts on the platform.
Service fees start at 1% for Bitcoin + 0.0003 BTC miner fee for each address; the platform gives you a native fee calculator which lets you know exactly what you’ll have to pay and how your mixing process will pan out. The minimum deposit you heed to make is set at 0.001 BTC. There’s also an extensive knowledge base summed up on the website, as they provide testimonials, news, a native blog, and several links towards material that can teach you more about Bitcoin mixing. You’ll also find an API which can be used to introduce the BestMixer service to your website. One welcome feature is the Letter of Guarantee which lets you verify your transactions. Visit the project’s website for more information on this very solid service.
Some Final Thoughts
Overall, the mixers named above have survived the market scrutiny and developed a reputation as solid ways of making your Bitcoin private. Other similar platforms which we haven’t covered include Coinmx.io and ChipMixer.com, which are also fan favorites in online communities. Before using one of the platforms we mentioned above, you should do some snooping yourself to make sure that there haven’t been any new revelations that might have endangered the platform’s reputation or its ability to make your coins private. After all, you are dealing with third parties who you’ll need to trust with your Bitcoin; any red flags you notice should make you think twice about using a service. For precaution’s sake, maybe mix a sum that’s just above the minimum required deposit to test out the platform. Hopefully you’ll find one of the platforms we listed above good enough to satisfy your anonymity needs.
CaptainAltcoin's writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of CaptainAltcoin.com