Bitcoin Mixer List FAQ

Finally, you can find the answer to any topic that I didn’t write about on other pages in here.

Why Do Governments Dislike Bitcoin Mixers?

Governments have a thing against bitcoin mixers because bad guys use them from crime. There’s no conspiracy theory about governments trying to dismantle Bitcoin or anything like that, but there are salty bank chairmen who’d like to. For the most part, politicians around the world actually see the benefits of cryptocurrency. A few more would agree with this bitcoin mixer list.

Unfortunately, there are also a lot of politicians from the old, pre-technology age who do not understand crypto. They are also quick to make judgments about it. Examples should be quite obvious since you can read them in the news on a near-daily basis. So this is where the majority of negative crypto action comes from.

Bitcoin mixers, and for that matter, CoinJoin wallets and exchanges, are all abused by criminals, and that is not going to change anytime soon, if ever. But the last thing we need is complete, Orwellian surveillance over our digital transactions. That is why people make bitcoin mixers. Even the wallets that implement blacklisting do so begrudgingly, because the natural evolution of that is to decide who gets to use your service and who can’t. (Like PayPal.)

Which Is Most Private: Mixers, exchanges, or CoinJoins?

By far and away, the most private method for anonymizing your Bitcoins is by using CoinJoins, followed by exchanges, followed by mixers. The reason behind this is simple: CoinJoins are a built-in part of the protocol and thus leave little trace. Exchanges use ordinary transactions, but if sent between exchanges via Monero, offer equivalent anonymity, but it’s slightly harder to do. Mixers are centralized, and you need to trust them to not keep logs and to set up their sites properly. And there is the risk that they might be a honeypot.

Although as I wrote earlier, all of these methods must exist for Bitcoin to be healthy. Because without bitcoin mixers, law enforcement would be going after exchanges or CoinJoin wallets instead. Is that a future we want?

How Does A Bitcoin Mixer Work?

Most modern bitcoin mixers create a session for each user. Each one calls it a different name, but they all look something like the one showed in this picture. (It is defunct, by the way.) The session key is so that you can close the browser, open it later, and then type the key in order to withdraw your bitcoins manually. As such, it is sort of like a password which must be kept secret. Some mixers like the one pictured use a public and private key instead of just one key. Think of it like using SSH keypairs instead of passwords.

To start, bitcoin mixers have a large number of transaction outputs before they start the service. It is common for them to have thousands, tens of thousands, or even hundreds of thousands of outputs. Ideally they would receive each transaction output in a different address, in a fixed size. Having coins in fixed sizes like 1 BTC, 0.1 BTC, 0.01 BTC, makes each balance look the same and makes blockchain analysis harder (but not impossible).

The above is very important – if a bitcoin mixer does not start off with a large enough output set, then someone can easily analyze the whole transaction history at once, and the anonymity is reduced to that of a single (giant) CoinJoin.

After you create your session, the mixer automatically generates a personal address. Then it waits for you to deposit any amount of bitcoin, and it breaks it into equally-sized pieces as I explained above. Additionally, there may also be an option to donate some of the deposit to the mixer so that you receive less bitcoins. This makes the deposit and withdrawal look like they are from different people.

What Are AML Scores In Mixers?

AML scores are values between 0 and 100 percent that are calculated by blockchain analysis companies to determine the lkelihood of a particular bitcoin UTXO coming from money laundering activities. It is not a flawless system but it is the basis by which many exchangers decide whether or not to demand KYC from you in order to complete the exchange.

Generally, the scores are usually either 0, 25, 50, 75, or 100. Values closer to zero and 25 are UTXOs from mined blocks, exchange withdrawals, coins obtained by payment processors, and inter-wallet transfers. Of course, blockchain analysis can’t know for sure what kind of activity is associated with an address without corroborating other data from the public internet, which is what they do.

Scores closer to 75 and 100 are given to addresses associated with sanctions, scams, gambling, and – you guessed it – mixers. Mixers are flagged indescriminately despite the fact that it is impossible to unmask the previous transaction history of mixed funds. However, they do this as a sort of blanket ban.

As a result of this, funds from exchange withdrawals are highly sought after by mixers, as they ensure that the mixed funds have a low or zero score associated with them. Some go as far as paying large premiums for those coins, such as Jambler.

Withdrawing Coins From A Mixer

A bitcoin mixer usually takes a long time to mix the coins. That is because it tries to space out each transaction of the mix into variably-separated blocks so that the timestamps don’t look too close to each other. Also, sending the mixed bitcoins to the destination right after the mix will give it away too. So mixers usually take one of three approaches:

• They automatically send you the withdrawal bit by bit, waiting for some time in between
• The mixer waits for you to manually initiate a complete withdrawal
• They give you a set of private keys which you should import in a wallet

Additionally, most mixers allow you to split the withdrawal into many addresses for extra privacy.

The most important piece of the setup is the Letter of Guarantee. This is a file with a PGP signature, and contains proof that you started a mix. You download this letter when you begin each session, and it allows you to get your coins out if the mixing process messes up. In order to make the process work, bitcoin mixers put a public key on their website. They also made a private key for PGP and keep it. Most mixers keep the private key on the server so that they can automatically generate letters. But this approach allows law enforcement to compromise the whole mixer, if they seize the server.