Are mixers illegal?

[maxreish]

There's an issue before about bitcoin mixers wherein money launderes used mixers to completely become anonymous. Illegal activities have been recognized with mixers and authorities and regulators are questioning how mixers really work as legal in such countries.

I'm not against it, but the fact that we use mixers to completely mask our identity is kinda appealing to those who has a bad intentions in the first place or the ones who just want to try this service to untraced the transactions.

It is still legal despite of the past issues.

[Lanatsa]

from the beginning until now, I have never heard of the problem of bitcoin mixers in my place. besides, so far the problem is only about the development of bitcoin and altcoin.

mixer can be use to eliminate traces of the transactions we do, it's just that I think that those no one who want their transaction activities are noticed. so, i think to use a mixer can be solved the problem for some people to do have a transaction. even though I haven't used it, I think the mixer is still permitted. if not, I think there have been many challenges about this.

Then what you do called of this one? https://www.bleepingcomputer.com/news/security/bestmixerio-service-shut-down-for-laundering-200-million-/
They have been already a honeypot for government yet they do presume that these so-called illegal transactions is tied up with these mixers.

On topic, I don't see for these services to be legal ones but come to think on what happened on the past I'm pretty sure they would abide regulatory rules.

[slaman29]

I would love to have a general conversation around mixers and if they are legal. I've heard both sides. Would be great to have someone involved in the legal side of things like Ciphertrace or a regulator to shed light on this topic

They're not illegal unless they operate where they need a license as a money handling company. Just like casinos and exchanges aren't, if they don't obtain the necessary licenses.

But legal or not, if you knowingly help criminals facilitate their business, then yeah, you're going to get a call from the police some day. Ciphertrace is working with them as a paid agent now.

[coinfinger]

Mixers are not illegal, and even some wallets (Wasabi and Samourai) that have integrated mixer are not illegal,
but you better watch out when using any of the web bitcoin mixers, as there are many scam and fake mixers online.

Sometimes, it is. Recently, a lot of known mixing service has stopped operating their service, one or two might have been seized as well. We can say it regulation as well. You are true as well, there's a lot of fake mixing sites out there.

Not much of the peoples linked to bitcoins might be using bitcoin mixers as there is hardly any need to do so if you gross your earnings legally including paying your taxes on time. Peoples who do not obey the regulations and enter the offensive side of the cryptocurrencies might need a bitcoin mixer to make their funds disappear and then revert back from an trusted/legal source. Thinking rationally, it might get easy tracking all those illegal transactions which are been mixed by digging the databases from various mixers(of course those mixers which do keep track of their records).

Considering what you said, i think that the transaction fees for the bitcoin transaction does not relate to any of the bitcoin mixers but it entirely depends on the mining difficulty of the miner interference. I can't co-relate the transaction fees with bitcoin mixers. Please correct me if I am wrong on this.

[iMark]

I would love to have a general conversation around mixers and if they are legal. I've heard both sides. Would be great to have someone involved in the legal side of things like Ciphertrace or a regulator to shed light on this topic

We may question the motives why Bitcoin needs to be mixed when in fact Your transactions in Bitcoin remains anonymous unless you already posted somewhere your address where your coins are stored. Is it legal? Yes it is legal to countries that doesn’t have any law passed to make it illegal. Is there a country that already made mixing Bitcoin illegal?

Of course we already know the motive, what else if not money laundering, what else besides that? because we ourselves know that bitcoin transactions remain anonymous even though they are transparent. No one knows your bitcoin address, nobody knows how many bitcoin addresses you have. so why are you looking for other methods to be more untraceable transaction, if not for that activity. Even so, the rules will depend on the laws of each country right?

[carlfebz2]

I would love to have a general conversation around mixers and if they are legal. I've heard both sides. Would be great to have someone involved in the legal side of things like Ciphertrace or a regulator to shed light on this topic

No they arent illegal but this service is being used neither on legal or illegal thats why government do really have bad impressions and views towards mixers thats why we do see
that there were being ceased or being closed because they didnt able to comply on what the government do asked.For sure most mixers now are in the eyes of the government and  mixing service owners for sure do saw the possibility of regulation as the years pass by.

[spadormie]

No. As long as the mixers are strongly following what SEC want them to do, they're pretty much safe. But I just don't know now since there are some mixers that closed with the last few months like bitblender and bitmixer. Bitblender was sitting for many years yet it closed. The only mixer that I know is chipmixer.

[adroitful_one]

No, mixers are not illegal. But, keep in mind, if you use them for illegal means they become illegal. Also, you could receive back coins that were acquired through illegal means and may end up having to answer some questions if there's ever any sort of investigation. For instance, what if you received coins that were involved in the Silk Road investigation? I haven't ever heard of this happening, but it very well could.

[The Sceptical Chymist]

In most countries there is no law prohibiting the usage of a Bitcoin mixer however you would have to check this with your country specific laws.

Just a general question: where are these laws even found?  Not being a lawyer, I have no idea where to even find out what's illegal and what isn't as far as crypto is concerned.  I got interested in that question when Binance dropped support for multiple states in the US and I figure that's because there are laws on the book--but I really have no clue about how to look them up.

Are there any lawyers or people savvy with looking stuff up like this?

Anyway, I can't imagine any countries have specifically banned mixing services unless they fall under some existing money-laundering laws already on the books.  I don't think any of them have been challenged in the courts, and if they have I've not heard of it.

I even think that some mixers are under FBI and it is easier to control dirty money

Eh?  I wouldn't put it past the FBI, but I doubt they're in cahoots with any coin mixers.  What I would not doubt is that they have mixers under their watch.

[fullhdpixel]

Of course we already know the motive, what else if not money laundering, what else besides that? because we ourselves know that bitcoin transactions remain anonymous even though they are transparent. No one knows your bitcoin address, nobody knows how many bitcoin addresses you have. so why are you looking for other methods to be more untraceable transaction, if not for that activity. Even so, the rules will depend on the laws of each country right?

I still cannot know the reason for it too really, and left to me, I think if the government wants to start any regulation, this should be the first focus, they need to ban it first, because this system is a scam system to me, and if we really reason it well, based on what you said, bitcoin is already anonymous and I don’t see any reason for more deep anonymity if it is not for ulterior motives of the provider to use it for scam purpose.

This was how binance actually could not trace their hacker, and even so many people have used it for money laundering that would make it not traceable. If the activities of people using it become rampant, government might really have to go after it as I don't even see any effect of it on the market. It is not helping coins appreciate but rather tarnishing the image of cryptocurrency.

[rijaljun]

No. As long as the mixers are strongly following what SEC want them to do

Are the existing mixer sites regulated under SEC law so you can say it's a legal thing? It also must be based on each country as different country has different law regarding this. Remember that bitcoin is also illegal in some countries.

[joinfree]

I am not a lawyer but whats i know is that  currently there is no specific  law  governing mixing networks.  but  its  up  the  user to use the mixing network   for legal or illegal  transactions. I know is that  some day  all the  privacy  coin will be ban that where  mixer will also  become illegal.   

[Mpamaegbu]

I want to believe that what Tumbler services/Mixers tend to do is bring back the days of anonymity that was the hallmark of cryptocurrency but now missed because of the almost mandatory KYC. Transactions are done and the receiver is hidden from any trace. That way, cases of armed robbers and bandits breaking into homes to harass hodlers are put at bay. Those who insinuate something insidious like money laundering and terrorism as things mixers indulge do not have strong points. Reason being that these vices are everywhere, not just with cryptocurrency.

[SummerBliss]

I would love to have a general conversation around mixers and if they are legal. I've heard both sides. Would be great to have someone involved in the legal side of things like Ciphertrace or a regulator to shed light on this topic

Anything is illegal when law explicitly quote it to be illegal. I don't think any country has law that clearly mentions mixers as illegal. However, the working of mixer is surely questionable. Why a person who earned/bought Bitcoins legally and paying correct taxes on his incomes would try to anonymous his holding? Mixer is the tool that is mostly used to anonymize gambling earnings and other shady earnings, however I am not judging.
So if you want to try mixers as a user, you can go ahead, there is hardly a chance you would be tracked back. But if you planning to start one, be prepared for contingencies as authorities will surely poke in their noses once you grow in size.

[exstasie]

In most countries there is no law prohibiting the usage of a Bitcoin mixer however you would have to check this with your country specific laws.

Just a general question: where are these laws even found?  Not being a lawyer, I have no idea where to even find out what's illegal and what isn't as far as crypto is concerned.  I got interested in that question when Binance dropped support for multiple states in the US and I figure that's because there are laws on the book--but I really have no clue about how to look them up.

Not sure about other countries but in the US, money transmission laws are the biggest sticking point, and it's mostly regulated at the state level. That's why companies like Coinbase have licenses to operate in dozens of states and also why they don't operate in certain states at all.

There are federal obligations too though. I'm reading now that FinCEN (US regulator) is arguing crypto-to-crypto transactions are no different than crypto-to-fiat regarding MSB obligations at the federal level. Crazily enough this seems to apply to mixers as well as certain DEX platforms, payment processors, etc:

Crypto-to-crypto or crypto-to-fiat conversion is treated in the same way. According to the guidance, it appears the following would need to register as an MSB: Anyone exchanging or administering a token (called a convertible virtual currency, or CVC, in the guidance) who is not already regulated by the Commodity Futures Trading Commission (CFTC) or the U.S. Securities and Exchange Commission (SEC). This includes

    Peer-to-peer (LocalBitcoins/OTC)
    Custodial wallets (not your keys, not your coins)
    Crypto ATMs
    DAaps
    Mixers
    Crypto payment-processors
    DEX’s that don’t auto-execute and take custody in the middle of the trade
    ICO issuers who don’t register with the SEC
    Mining pool operators who host all the wallets on behalf of pool members

Anyway, I can't imagine any countries have specifically banned mixing services unless they fall under some existing money-laundering laws already on the books.

It looks like they plan to treat them like banks, whose regulations require KYC. I guess that creates a situation where they might come after ones who don't comply like they did with BTC-E.

[1Referee]

They are legal, but I think if authorities would ask them for cooperation,mixers won't refuse it.

If that was the case, all mixers would be useless today because no one would use a mixer if it was known that they will cooperate with any goverment asking for data exchange.

Mixers by default are illegal because they aren't just offering people some layer of privacy, but they're unlicensed money transmitters on top of that. If you don't want to be held responsible for something, then it definitely is not being held responsible for running an unlicensed money transmitting business.

Governments could just come up with extra allegations to make life impossible for you as operator of a mixer.

[panganib999]

I would love to have a general conversation around mixers and if they are legal. I've heard both sides. Would be great to have someone involved in the legal side of things like Ciphertrace or a regulator to shed light on this topic

Mixers was viewed illegal because of the scandals and crimes that involved and use mixers upon executing their crimes, giving people the thought that using it is a crime and is illegal. But technically, it isn't. Mixers are actually helpful especially for crypto enthusiasts and people who wants to do a private transaction for their businesses. Bitcoin mixers breaks the links between your address and the other parties transactions providing you anonymity to your identity. The legality of mixers varies with how and where would people use it for.