Exchanges vs Mixers

[pooya87]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

nobody said people should use mixers and they certainly don't use it for laundering bitcoin. because for example if you have 1000BTC and don't want to pay taxes on it, if you use a mixer you still have 1000BTC and still have to explain to the tax man where you got it from and why haven't you paid your taxes!

mixers are used to increase your anonymity. for example if you have publicly showed your address and linked it to yourself now everyone knows how much bitcoin you own and what you do with it. you use a mixer to prevent them from knowing this.

exchanges do practically the same but they keep logs and they may block your account if you are just depositing and withdrawing bitcoin without trading !!

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[panju1]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

If you use an exchange, there is a trail. Most exchanges require identity proof, especially if you trade large amounts. Mixers have no such requirements and can tumble your coins for a small fee.

What about Localbitcoins?

Local bitcoins force you to sell your bitcoins and then buy them back. If it is a large amount, payment is definitely through bank accounts and there is a trail. Plus, the premiums that traders charge on localbitcoins is usually pretty large.

[taxmanmt5]

Why one suggestion for you, it's not the very moment that you get that private key you sweep that into a brand new wallet. I think the blockchain. Info does that through the site otherwise you could use a software wallet and almost all of them will allow the import of private keys, some of the wallets called that sweeping and not a mixing

[SONG GEET]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

Both Exchange platforms and mixers might have tainted coin so you can't get clean/recently mined coin from any of them. Exchange platforms just send out withdrawals in bulk which might link you to many other bitcoin addresses which are not yours and on the other hand mixers will send bitcoin to your address only after mixing which is better. Also mixing coins is not to make cleaner coins, it is to add personal privacy on top of inbuilt anonymous feature bitcoin have.

[audaciousbeing]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

My contribution is most times the fees involved as we have seen some mixing services that gave the  option of donation rather than compulsory fees which the signature I am wearing is an example, but in the case of exchange sites, that cannot be avoided for any reason. Another, is the just the annoying kyc that is put in place which a lot of people avoid but for reputable mixing services, you don't have to bother yourself about that.

[HabBear]

At least you won't get even dirtier coins than you had before.

This is an interesting comment - Does currency carry with it the sins that it was previously used for to a new owner?

I don't think so but what do you think?

When bitcoins are divisible to the 100 millionth of a coin there's no such thing as traceability back to original coins. Once the owner decides to send bitcoin the history of those satoshis are refreshed and start anew.

How do coins get labeled dirty? (Unless we're talking about 2011 Casascius brass.) Let alone "dirtier"?

[dothebeats]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

If they want to launder btc, why would they leave some trails of their coins? Buying other coins and withdrawing them would still keep a record of your activity in their platform since they require you to provide your identity in doing some large trades whereas mixers, they only require a small fee for your coins to be lost among suspicious eyes.

[diagla]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

If you use an exchange, there is a trail. Most exchanges require identity proof, especially if you trade large amounts. Mixers have no such requirements and can tumble your coins for a small fee.

What about Localbitcoins?

Localbitcoins still has a trail. You must realize that in order to withdraw, the site/exchange sends the coins to you. They know exactly what address it comes from and goes out to. They can track your coins if needed. That's why mixers exist, the addresses are anonymous.

[squatter]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

I think what just happened to BTC-e shows the failure in this line of thinking. The regulated exchanges won't let your darknet market coins in. They'll freeze your account and report you to the authorities. BTC-e never would have done that, but here we are.

To be honest, I don't even send coins into KYC exchanges anymore. I send fiat money into Bitstamp or GDAX, buy, and keep the coins on exchange or send to cold storage. Whatever coins I've made from sports betting or trading, those definitely don't get sent there...

[oktana]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

I think what just happened to BTC-e shows the failure in this line of thinking. The regulated exchanges won't let your darknet market coins in. They'll freeze your account and report you to the authorities. BTC-e never would have done that, but here we are.

To be honest, I don't even send coins into KYC exchanges anymore. I send fiat money into Bitstamp or GDAX, buy, and keep the coins on exchange or send to cold storage. Whatever coins I've made from sports betting or trading, those definitely don't get sent there...

In the end, kyc is the only way that the SEC and and other financial security agencies do not continue to harass many users and the bitcoin trading market, this is a very vital case and we have obtained the facts from btc-e, money laundering is not expected by the government and eventually mixer business will make them reluctant to continue the program.

[Rahar02]

Exchanges is a place to buy and sell bitcoin, even though you buy some forks and sell it for bitcoin again, doesn't mean you get cleaner/dirtier coins than you had before? If your intention to launder bitcoin, forget about exchanges and mixers, you would harm their reputation with criminal acts. Mixers doesn't create to laundering coins as there are many reasons why we should use mixers to keep your transactions private, especially when dealing with large amounts.

[deisik]

At least you won't get even dirtier coins than you had before.

This is an interesting comment - Does currency carry with it the sins that it was previously used for to a new owner?

I don't think so but what do you think?

When bitcoins are divisible to the 100 millionth of a coin there's no such thing as traceability back to original coins. Once the owner decides to send bitcoin the history of those satoshis are refreshed and start anew.

How do coins get labeled dirty? (Unless we're talking about 2011 Casascius brass.) Let alone "dirtier"?

There is karma at play here

That is, if you buy dirty coins and you know that they are dirty or could be dirty since you buy them in a shitty place (note that I don't necessarily mean Btc-e), the dirt is passed on you, as simple as it gets. It is like buying stolen things which you should never do however cheap the price might be (this is a firm no-op). Regarding the question asked in the opening post, personally, I see exchanges as a more reliable means to hide your coins (provided you don't disclose the details of your identity, of course)

[squatter]

What is the reason why people should use mixers (if they for example want do launder btc)? Never used such services but for me it seems better just buy some forks on exchange and buy bitcoins back. At least you won't get even dirtier coins than you had before.

I think what just happened to BTC-e shows the failure in this line of thinking. The regulated exchanges won't let your darknet market coins in. They'll freeze your account and report you to the authorities. BTC-e never would have done that, but here we are.

To be honest, I don't even send coins into KYC exchanges anymore. I send fiat money into Bitstamp or GDAX, buy, and keep the coins on exchange or send to cold storage. Whatever coins I've made from sports betting or trading, those definitely don't get sent there...

In the end, kyc is the only way that the SEC and and other financial security agencies do not continue to harass many users and the bitcoin trading market, this is a very vital case and we have obtained the facts from btc-e, money laundering is not expected by the government and eventually mixer business will make them reluctant to continue the program.

I'd say that any of the larger exchanges like Bitfinex, Poloniex and Kraken are big targets for the US government now. That's why we see Bitfinex exiting the US market, Poloniex changing its terms, and Bittrex enforcing stiffer verification, all in reaction to the BTC-e shutdown.

Smaller exchanges, especially if they prohibit US customers and don't handle fiat money, are probably fine to continue operation. But it's clear that regulation is where we are heading now, and larger exchanges can't hide from the long arm of the US law.