The Stigma With Bitcoin Mixers It seems that the majority of members here on the forum think that Bitcoin mixers are used for illegal money laundering. Although despite Bitcoin mixers being used for illegal purposes they serve a legitimate service for those that care about privacy and I would like to inform the members of the forum why Bitcoin mixers aren't going to be illegal unless its a direct result of censorship.
My goal The reason for this thread is because I am seeing an increasing amount of people thinking that Bitcoin Mixers are used majority by criminals and therefore the only reason you would use a Bitcoin mixer is if you were trying to hide something which is completely false and the wrong mentality to have. Here's a quote that triggered my thought process on this and the ultimate decision to create a thread and instead of relying back on that thread with a off topic reply I thought I would make a response here without singling out the member because this is a very popular mindset.
mixers are usually used by people with a gambling or drug addiction or for criminal purposes. If your campaign has good prices, it does not make her money less "dirty". True cryptans use Monero to ensure anonymity, and do not try to turn bitcoins into mincemeat through a mixer. Therefore, please moderate your ardor in matters of reputation (or remove your signature). Thanks.
![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
This member is completely misinformed about Bitcoin mixers and made a completely false statement "Mixers are
usually used by people with a gambling or drug addiction or for criminal purposes". I am not sure where this member is basing their assumption but that is exactly what this is an ASSUMPTION. Bitcoin mixers or any mixers are not just used by criminals and if you value privacy then a Bitcoin mixer will probably be of interest to you. I'm going to back this up with some studies;
According to this
study only 16% of the funds entering mixers in our study came directly from illicit sources, and they are commonly used to prevent snooping rather than to launder funds.
The majority of mixing sources have not been known to be "dirty" coins and what I mean by that is they have not been known to be part of any publicly documented theft or money laundering. So this debunks the statement of mixers being only used by criminals and only for illicit purposes. The results from that study show us that the opposite is actually true and the majority of funding sources are used by innocent users probably looking to increase their privacy.
How does a mixer help with privacy? There are different types of Bitcoin mixing services out there but it all boils down to one principle. Bitcoins being sent to different addresses to "cloud" the view of anyone viewing it from an external point. There is both centralized and decentralized versions of Bitcoin mixers.
Centralized vs decentralized This all depends on how much privacy you want. A centralized approach to Bitcoin mixing means that you have to trust the third party in handling your data. Some Bitcoin mixing services have got busted by the feds and have had to cough up information to them in the past. However a decentralized version means no one knows or controls any information that might be other wise logged with a centralized mixer. A centralized version usually means that Bitcoin users pool their coins together and then take equal amounts out from that pool while the centralized authority keeps logs of what is happening.
My ending thoughts I would like to make it clear that Bitcoin mixers have legitimate reasons to be used outside of money laundering and other criminal events. The Blockchain even though its transparency is one of the biggest benefits of the system can sometimes bite its users in the ass when coming from a security point of view. Lets say John has 1 million worths of Bitcoin in his wallet and pays for a pizza this is publicly displayed on the ledger and John could become a target to those that want his Bitcoin either through hacking or physical threat. Simply sending his Bitcoin to different addresses isn't going to help privacy wise for John. However if he were to use a Bitcoin mixing service he would be able to "cloud" the vision of anyone looking at the Blockchain and hide his coins from prying eyes. John now does not need to worry about physical harm or hacking because of people knowing how much Bitcoin he owns.
Its also good if John wanted to buy a dildo and didn't want people to know he was into that sort of stuff. So my point being is privacy is important to us all for very different reasons but just because you don't use a Bitcoin mixing service because of the risk of trading in dirty coins don't go around putting statements such as "Bitcoin mixers should not be used unless you have something to hide" because that's silly. We all use Tor Browser for a reason and that's to protect our identity from other people or governments not because we are doing anything illegal but because we value our right to privacy.