Bitcoin Forum

Hi. Im curious about bitcoin and how it works. If a person sends around 1 BTC in a tumbler, is it easy to track the transaction? I mean, how much people do not send around just 1 BTC every hour. Is it easy to track smaller transactions? Or easier to track larger transactions? Lets say that 10,000 people send around around 1 BTC per hour. How would these trace tools know which BTC transaction belongs to who?

See, the point of bitcoin mixers/tumblers is to "tumble" your coins so you can move your bitcoins to another wallet with it being untracable or atleast significantly difficult to trace. Transaction size isn't a indicator of a transaction's traceability. Can you expound your last question? Not sure if I understood it correctly. What trace tools specifically are you talking about?

Each bitcoin mixing services has sort of different methods, but the concept is the same. Try reading about ChipMixer if you wanted more information from the mixers themselves: https://chipmixer.com/faq

It's really hard to track coins after they get tumbled, but the point of failure in this model is in the fact that mixers are centralized. You are basically trusting that the hosts of the mixer don't reveal the logs to anyone looking for your coins.

I did once an experiment just to learn how mixers work. I think helix is the best mixer, they have Tor and they got several options.

I also don't really recommend it. I would never do anything illegal so I don't want to end up with coins that are tainted as illegal when you mix the coins. You never know what coins you are getting after the mixing... who knows if these got tainted as illegal by some police somewhere, then you try to cash the money out and you get in trouble?

This also showcases the problem of lack of fungibility in Bitcoin btw.

Never heard that there are some trace tools out there except manually tracing the bitcoin transaction using the blockchain explorer.
Since you are using a mixer like you said its not traceable because they already had reserve bitcoin that they can send you with clean coin..
That is why there are few mixer out there are good to use if you are using illegal. or you don't want to trace your transactions. .

Today's best mixing service is in my signature below.

Your input BTC are not linked to your output BTC. Outputs are paid in private key format which makes it easy for you to incorporate them into any wallet of your choice.

Tracking the transaction ends in the input address itself. If you send 1 BTC you do not get 1 whole BTC chip in return. The output bitcoins are divided into "chips" which you can withdraw to wallets in time increments (say, 1 chip now and 2 chips a few hours later and the rest of the chips tomorrow or next week). This makes tracing and linking of transactions very challenging, if not even impossible.

Given that TumbleBit is an anonymous protocol that is fully compatible with today's Bitcoin protocol, I wonder why it hasn't taken off yet. Was I mistaken, and it required Segwit or something? I've been wondering how TumbleBit will measure up vs. centralized mixers, in terms of liquidity for mixing, reliability, and usability. It seems like bitcoin mixers are active as ever, though, in the wake of Bitmixer shutting down.

Theres also a chance that the mixers are now operated by law enforcement. After the darknet markets flourished, the government had to fight back by setting up honey pot services or they themselves have to compromise services that are being used by darknet participants.

Bitmixer might have been compromised, thats why the owner posted that weird message and left.

Okay to answer your questions:

1. The transaction itself to the tumbler is completely public and can be viewed from any computer across the world as long as they have internet access. But once the bitcoin gets tumbled a completely unrelated output gets sent to the destination address(or in chipmixer's case, a pre-generated "chip" or private key is given to the user), and is extremely hard to trace who exactly sent it.

2. It is definitely easier to track larger transactions, they get noticed by everyone because of the sheer volume.

3. By trace tools you mean services such as walletexplorer? If you mean that, then how they work is essentially they scan an address's transaction history and see if there are any joint inputs. If there are, then it can be deduced that the two addresses belong to the same person.

Sure, that's believable. I never really thought about that, since the obvious choice for law enforcement is to operate a darknet market as a honeypot (like Hansa)--lots of data given away there even with the best operational security by vendors. But a mixing service would be useful, too, for catching the low-hanging fruit. For proper security, it would make sense for mixing to be only one step in a multi-step process (perhaps also using non-KYC services through TOR/VPN).

Doesn't really explain why the owner left the way they did, but you raise a good point...

Yeah the bitmixer incident was extremely strange. They were one of the leading mixers making millions from mixing fees. The signature campaign was one of the oldest ones, and they always paid like clockwork, so it shows the advertisements in here work, they got their brand everywhere, and they were able to afford it.

I don't believe for a second that he woke up one random day and decided that it was over because of moral reasons.

Anyway, I still don't recommend using any mixers and I don't recommend doing anything illegal. Now im worried about the BTC that mixed to test things out if I want to sell these.
If I sell and they ask me about the origin, they would see on the blockchain that they got mixed under a ton of other addresses.

Fungibility is an huge problem with BTC.. I hate having to keep track of tx addresses.

We might never learn the whole truth about Bitmixer, after all mixers and their owners are not the most transparent services in the bitcoin ecosystem.
I heard that Bitmixer was intimidated by authorities and this is the reason behind their sudden disappearance.

Mixing your coins is not always related to illegal activities.
What about a situation when someone is extremely paranoid about his privacy and want to keep all bitcoin transaction to himself?

Trying to track coins that have gone through mixing services is classic police work.  If you go through a "classic" Bitcoin mixer like the defunct Bitmixer, you would deposit coins and they would pay you different coins that were deposited to them earlier.

Authorities would have to try and deduce some addresses which belong to the mixing service, and separate the different coins being mixed by amount (0.112 BTC is deposited to Bitmixer, the same amount minus fees comes out to a different address).  Blockchain analysis tools aren't too bad at stuff like this.

It's equally difficult to track large amounts to small amounts, it's only about how well the owner of those coins has protected their privacy.

In the case of Chipmixer, you receive entirely new wallets (Electrum wallets) instead of just new coins, and the wallets have fixed amounts of funds already inside of them which are different amounts to the amount you deposited.  Many mixing services try a variety of methods to get rid of the blockchain link to your coins.

As far as I know, everyone that runs mixing services is anonymous and probably always uses Tor/VPN to access the network.

What I don't understand is, how do you sell your gains?

Let's say you run a mixing service, and become a millonaire. You want to buy real state with your BTC, a nice house, and you need to sell and tax it. When they ask about what the origins of these BTCs are, what would one say? "I run a mixing service". Wouldn't that put you in trouble?
Or maybe this is still a grey area, and this is why Bitmixer guy disappeared, he will sell/has sold his BTC before it becomes illegal.


Sure, but I don't think the authorities would care that you didn't do anything illegal. If you mix coins, and the coins you receive are being tracked by authorities, you now own these coins. If you go and sell these coins for fiat, they will see that you owned these coins, now these coins are linked to your real life identity and now you are in trouble... see what I mean?

That is why im worried about the BTC that I mixed to test around, im not sure if I should ever sell that..

That is the whole point of mixers. It would be extremely hard to trace a single transaction within the multitude of transactions that get mixed in a mixer. There is added difficulty when you change the % of fees, the time it goes out, how many outputs it does, etc. It might be mixed as much as possible but really it can still be traced, the effort though of tracing a single transaction will be like looking for a needle in a haystack.

Fungibility is definitely becoming a problem as all these blockchain analysis companies are taking off. Tracking peoples' bitcoins is much, much more sophisticated today than it was a few years ago. I really can't wait for a working TumbleBit hub. Apparently, it's a uni-directional unlinkable payment hub, and it's fully compatible with today's Bitcoin protocol.

On Stratis, TumbleBit has just been integrated into the Breeze wallet for added privacy. Can't wait to see this happen for Bitcoin.

To raise their operations security the darknet actors should also need to use the right tools. VPN, TOR and a centralized mixing service is not good enough anymore.

Those users who want their safety should start using anonymous cryptocurrencies. Im not sure which one is the best to use but Zcash, XMR and Dash are all available.

Zcash is pretty lame since no one uses anonymous transactions. As such, your privacy isn't protected by using them. I don't know much about Dash, but I have heard very promising things about Monero's privacy features. That would be my top choice for now.

I think that VPN/TOR and mixing through non-KYC services might be enough if it weren't for the centralized nature of the darknet markets themselves. They can give away all sorts of metadata critical to law enforcement, on top of being honeypots, and you have to trust that the admins are taking precautions to encrypt properly.

So, we need decentralized exchanges, decentralized darknet markets, trustless mixing (Tumblebit)... I wonder how long it will take to get there.

This is true and who the hell would search for a certain address in a bunch of address on that transaction. These what mixers can do once it have been mixed its impossible to trace whats the origin of the said transaction and knowing that bitmixer have closed its service you can have still chipmixer and I do have tried their service and I'm quiet satisfied for being completely anonymous.

Indeed, the best mixer services trying to give you new coins which untraceable to your earlier coins whether in small or larger transactions. Seems impossible to trace all the way to link those coins to you, as that's the point of bitcoin mixer. Except if central authorities or law enforcement authorities interfere to this business, push the owners of bitcoin mixer and give the data to them, and that's traceable.

Decentralized exchanges, decentralized darknet markets, trustless mixing are not available yet. But anonymous cryptocurrencies are. You say its Monero. Ok. Why dont the people who have something to hide start using that?

Decentralized market places will be the next one coming with Open Bazaar leading the way.

OP, it s an excellent way to send 1 BTC and never see your 1 BTC again. Dont forget these services are designed to help scammers mix their Bitcoins so they cannot be followed. Your really thing they were not designed by scammers with the same idea. So you just go ahead a mix your coins.

I think the people trying to hide are definitely already using Monero. There was some XMR confiscated at Alphabay, for instance. The problem is that there is not much liquidity. Until it is much more widely accepted (and an economy is grown outside of centralized KYC exchanges), it's difficult to use much else than Bitcoin.

Not everyone of them. If they all were starting to use Monero then the price of XMR would be mooning right now surpassing Ethereum in coinmarketcap.com as the 2nd most valuable cryptocurrency.

The darknet is more huge of a market place than the ordinary person think. Soon most of the cartels will start having their presence in there.

The Blockchain keep track of ALL transactions, but mixer services makes it almost impossible for people to trace it backwards

to the sender's address. I know some mixer services keep zero logs {well, they say so} ...so nobody will be able to go

through logs to trace it to it's origin. The thing is, most people do not know who operates these mixer services... it might just

be the government.  ::) ..... like they are running exit nodes on the Tor network.  :P

If the US government isn't running a mixer service, they will be soon. The Hansa market honeypot makes very clear what direction things are going. Going forward, no centralized services can be trusted--assume any centralized service potentially logging your activities (or at least your metadata) is a honeypot and act accordingly. I'm amazed at the level of funds people put at risk on the darknet markets.

They dont have to run their own mixing service but what they can do is compromise multiple mixing service just like what they allegedly did to bitmixer.io.

Did you all read that funny final message from the owner? It almost looked like he was trying to discredit himself to make the community think something is really wrong.

Mixers are not run by any government, but BitMixer doesn`t exist, they shut down the service and here its why:
https://bitcointalk.org/index.php?topic=2042470.0 (https://bitcointalk.org/index.php?topic=2042470.0)
`When we started this service I was convinced that any Bitcoin user has a natural right to privacy. I was totally wrong. Now I grasped that Bitcoin is transparent non-anonymous system by design. Blockchain is a great open book. I believe that Bitcoin will have a great future without dark market transactions.`

Transactions can be followed no matter how small or big transactions are, you use service (mixer or tumbler) to hide where your transactions is going, cause you send it to service and then service mix/tumble all transactions and only then send. But service knows where your transaction is going, so if they are not protected well enough someone can hack them and see all transactions, of course service can decide to keep logs for some time or delete it after transaction.

I agree with BitMixer opinion `Very soon this kind of activity will be considered as illegal in most of countries. `, and this is right, bitcoin will not be anonymous and law enforcement agencies will be able to keep track of all bitcoin transactions.

How do you think Bitmixer was compromised--packet sniffing, IP logging? It sounds like you think the owner shut the service down and posted those messages after he realized that the site was compromised?

I admit the way that Bitmixer left was very odd. It seems like he was trying to warn past users that their IP addresses and metadata may be at risk due to snooping by the authorities.

And what happens when we use mixer very often? Isn't there a chanse to get that 1 BTC back again? Because as almost every mixer claims, they delete every information after 12 or 24 hour so this means there is a chanse that we will get our bitcoin back if we use mixer more than once.
This question was asked to bitmixer and seems it's still in question. I haven't heard answer.

It all depends on how much liquidity there is. And due to the opaque nature of the service, no one can ever know (except the operator) how much liquidity there is. Given the volume of darknet markets and the apparent visibility of very privacy-minded bitcoiners in the space, I would assume that the most popular mixer(s) would be fine for small volumes like 1-10 BTC.

You might get back a small bit of taint from your original inputs if you keep reusing the service. But the bigger problem is that you're probably getting back taint from much "dirtier" coins too, by using the mixer at all.

If you need major liquidity, these mixer services won't work. Imagine if the Bitfinex hacker tried to mix coins through Chipmixer. :P

Im not really sure but it would be very possible for law enforcement to have compromised bitmixer.io if they have also done so with the darknet marketplace Hansa.

Their methods should be sophisticated enough by now. Its also known that law enforcement also run Tor exit nodes.

Yeah, I have no doubt after seeing the recent takedowns that their methods are extremely sophisticated. I definitely underestimated them. A couple things of note here, though. For one, there was a case last year that proved that at least one VPN provider's claims of no logs were true. PIA was subpoenaed about some hoaxer and it came out in public court proceedings that they were unable to provide any information subject to the subpoena except that the traffic originated in the general area of Southern California. So no-log VPNs are still viable for the moment.

And yes, law enforcement runs Tor exit nodes, but they definitely don't run them all. I think the key here is not to be low-hanging fruit. There is a lot of low-hanging fruit for law enforcement to pick off. I'm still not convinced that no-log VPN, TOR and mixing through non-KYC services is not viable for the moment.

It's much easier. Obviously it was very easy to follow the transactions of this mixer and its followers. We took into account their mistakes. We offer to you to try and to take the advantages of the BestMixer.IO.