The US government is targeting mixers. Are BTC mixers next?

[edgycorner]

Tornado cash(ETH mixer) has already been forced to shut down (giving a 404 https://tornado.cash )

Going by Secretary Blinken's tweet, they seem to be on a hunt and anyone could be next.
https://twitter.com/SecBlinken/status/1556677862345801728

What are the chances of coinjoin and chipmixer getting in their scope? No service can judge a user and their intention for using their mixer.

Anyhow, we will always have BTC LN for enhanced privacy if you are worried due to this recent news

[Accardo]

The US Treasury department is indirectly telling the mixing platform that, “if you are going to allow a lot of illicit activity, we are going to go after you even if there is a lot of legitimate activity" Same thing is applicable to other mixers. As it has been known to everyone including fraudster that mixer help complicate the tracking of a cryptocurrency transaction.

N/B: The quote is owned by ARI REDBORD, Head of Legal and Government Affairs, TRM Labs.

[mocacinno]

AFAIK, governements have been going after mixers for quite a while now... I'm pretty sure that IF they find a mixer operating from a country where the government doesn't quite like crypto, they'll be closed.

I don't think this is anything new. Governements don't want privacy, they want taxes, and you can't tax things they cannot find/trace... Sure, it's nice that the couple percent of illicit transactions cannot be mixed either, but i somewhat doubt this is their primary objective...

[Poker Player]

What are the chances of coinjoin and chipmixer getting in their scope? No service can judge a user and their intention for using their mixer.

I don't know but I have said it repeatedly. I don't see much of a future in a business model that consists of obfuscating the origin of funds, when in the world the trend is the opposite. Everything is becoming more and more KYC, even people pay for everything with their mobile, deblocking it with the face ID, so that Apple or whatever company it is, apart from many other data, knows the face of that person.

Governements don't want privacy, they want taxes, and you can't tax things they cannot find/trace... Sure, it's nice that the couple percent of illicit transactions cannot be mixed either, but i somewhat doubt this is their primary objective...

That is clear. What they want is to collect more and more, and since Bitcoin is not controlled by a central bank, they take other measures with that excuse.

[franky1]

by using a mixer even if you are not a criminal. an exchange WILL and DOES flag you as suspicious and start to want to look at your account and activity alot closer than someone that does not use a mixer.

EG 2009-14 bitcoin was an asset/digital product.. but as soon as it mainstreamed as "currency" that triggered regulators to treat exchanges not as a product swap/merchant(like an auction house/pokemon card swap shop). but instead as a money service business(like forex). which means that the exchanges have to flag up certain things like mixing service even before proving someone is a criminal.
its called a SUSPICIOUS ACTIVITY REPORT, not a crime witness statement.

exchanges do not have to witness an actual crime first, and link that to a user that then mixes to then suspect it as laundering.
exchanges flag a customer that uses mixers as a suspect of laundering first. reports them, investigates the customer to see if there is THEN any extra chance of them being a criminal. where the authorities if they can find a connection to a criminal act (after receiving the SAR) then gets a court order to freeze the account

so using a mixer is not going to help you fly under the radar and continue on with exchange activity unnoticed.
you will be listed on a watch list and looked at even closer than other customers that dont use mixers

if there were 2 people walking down the street, both carrying a suitcase
one guy wears a suit and just walks normally..
the other guy has a anti-gov shirt on, tries hiding behind bushes and avoids camera's.. everyone starts to look at the suspicious person where they start to think 'whats in the suitcase', is it drub money, is it a bomb.

do you lot get the hint yet. trying to hide gets you noticed more. your actions become the opposite of your intentions

even if it is not about a 'criminal act' there are tax related flags too, whether its evasion(illegal) or avoidance(legal) exchanges need to look at their customers closer when certain flags are hit.

the reality is adding more "privacy" features to crypto does not make regulators give up and walk away, it makes them step up and move closer to adding more rules of use for crypto

[jackg]

What are the chances of coinjoin and chipmixer getting in their scope? No service can judge a user and their intention for using their mixer.

There are speculations bitmixer(.io) was closed for similar reasons back when that happened (many years ago) - chipmixer sprung up from the ashes of its demise though (not saying the two are linked but it might be possible for chipmixer to sell their assets and reputation to another/a new mixer if they think they're about to be told to stop operating - especially if they were denonymised and can work out how).

If there's a gap in a market something will spring up in the place of the last one though so it will probably become futile for them to even bother closing them down.

[edgycorner]

AFAIK, governements have been going after mixers for quite a while now... I'm pretty sure that IF they find a mixer operating from a country where the government doesn't quite like crypto, they'll be closed.

I don't think this is anything new. Governements don't want privacy, they want taxes, and you can't tax things they cannot find/trace... Sure, it's nice that the couple percent of illicit transactions cannot be mixed either, but i somewhat doubt this is their primary objective...

Possible, they could be setting up grounds to entangle crypto within their regulations. They will at least try, that's for sure. This is why BTC and PoW will never die  

What are the chances of coinjoin and chipmixer getting in their scope? No service can judge a user and their intention for using their mixer.

I don't know but I have said it repeatedly. I don't see much of a future in a business model that consists of obfuscating the origin of funds, when in the world the trend is the opposite. Everything is becoming more and more KYC, even people pay for everything with their mobile, deblocking it with the face ID, so that Apple or whatever company it is, apart from many other data, knows the face of that person.

I still love my privacy tho. I don't want any of my personal information to get leaked(sometimes intentionally by rogue employees) and get into the hands of bad actors. Nor would I like some entity(read apple,facebook, google) to have ay kind of influence over me.
Obfuscation of personal funds is a part of maintaining that privacy. To protect info about my spending mostly.

Monero and BTC LN are better suited for such task than mixers imo. Regardless of what's more efficient, it's still an attack on our privacy.

the reality is adding more "privacy" features to crypto does not make regulators give up and walk away, it makes them step up and move closer to adding more rules of use for crypto

They can certainly try. There's an active bounty of a million dollar by IRS on monero   And we got BTC LN too. imo, BTC LN should suffice for privacy needs for a common man like me.

exchanges do not have to witness an actual crime first, and link that to a user that then mixes to then suspect it as laundering.

No worries, I will do a P2P trade.

[Ucy]

.....

.  . .  the reality is adding more "privacy" features to crypto does not make regulators give up and walk away, it makes them step up and move closer to adding more rules of use for crypto

Developers need to create the kind of privacy feature that can't be abused/misused by criminals including those in government. If you can't develop a privacy application (for example) that is hard to abuse, better not develop at all because you will be creating more problems instead of solving problems without creating more problems.

I believe the only way to avoid the government is to solve problems in the manner listed above.  

[NotATether]

I don't think this is anything new. Governements don't want privacy, they want taxes, and you can't tax things they cannot find/trace... Sure, it's nice that the couple percent of illicit transactions cannot be mixed either, but i somewhat doubt this is their primary objective...

I am not anti-tax (unlike the late McAfee). People should be mixing their transactions to avoid surveillence from all kinds of monitors including the NSA and Chain-analysis companies, but not the IRS.

Pay your taxes guys. Capital gains only apply if you are trading cryptos [and even then ONLY if you cash out], not for HODLing crypto for a few months or years. Nobody charges a capital gains tax if the bulk of your money is in EUR and it suddenly rises up against the dollar.

[franky1]

any privacy tool. whether it is LN, liquid, monero.. are simply avoided by policy following regulated exchanges
coinbase is sister company of projects like LN and liquid. yet coinbase AVOIDS using its sister projects due to the default suspicious activity flags they trigger


some idiotic people then pretend that bitcoin is broke by its transparency and want to swap their pretend broke. for a real break by making bitcoin fully untraceable by breaking the transaction chaining of txo's vs utxo's(spent vs unspent) aka taint

the thing is bitcoins feature of linking someone's coin back to its hard rule creation method(mining reward), is actually a GOOD MONEY feature of security that ensures that bitcoin cant be counterfeited or new coin cant just be added in outside the hard rule
breaking the tracking/accounting of bitcoin breaks bitcoins utility as money/currency/asset. just for the selfish whims of shady people that are too lazy to think about how they personally should hide their activities and instead want other services/projects to do the hiding for their lazy asses

what you dont realise is that.. lets use LN for instance (the ignorant network)
regulators are already creating crypto laws where anyone facilitating the funds transfer of other people for a payment/commission is to be deemed as a money transmitter/money service business.
the idiot ignorant network people tried and failed to pretend that the law was a bitcoin attack on developers and miners.. yet that was just their sales pitch to (fail) to convince people that bitcoin was broke to advertise their altnet as the solution.

the reality is that LN routers, processing payments for a fee, then become the money transmitters/money services. where anyone offering routing on LN has to in the future register as a money service business and follow the same regulations as public exchanges.
yep the way they designed LN actually makes LN a network that requires its users to become regulated/licenced businesses just to remain legally able to stay operating.


liquid and monero is not seeing much transaction processing which shows how many people and business are avoiding using those because using those gets them watchlisted. so they just avoid even using them.

bitcoin is not broke and bitcoin does not ask for KYC but makes it easy for someone to prove their coins are not from malicious sources(for those not doing malicious tasks) and so those clean people get to transact easily without having to get watchlisted/frozen/questioned.

its the idiots that want to hide that end up getting noticed by their methods of hiding
them inventing fake problems to try to then demand solutions is a fools errand

[tranthidung]

What are the chances of coinjoin and chipmixer getting in their scope? No service can judge a user and their intention for using their mixer.

No party last forever but if current generation of mixers are broken down, there will be more future generations and governments always chase behind the citizen innovations. It is similar to Great Fire Walls in China that can not prevent 100% users there to access beyond that Great Fire Walls.

Not sure how ChipMixer created and registered on the Internet since the first place but if the governments can not find team behind it (that I believe it is), they can not shut down a service. Shut down a current domain does not make sense.

[ranochigo]

They are always trying to find reasons to do so. Mixers are used to improve the privacy and you bet that they're not a fan of it.

Sanctions and restrictions are not always helpful in certain cases. Some mixers are exclusively operating in territories that doesn't comply with court orders or have very different legislation from that of US. You can attempt to limit or ban connections to that website but it can be difficult to pursue those that operate on Tor or without a physical identity.

[franky1]

I am not anti-tax (unlike the late McAfee). People should be mixing their transactions to avoid surveillence from all kinds of monitors including the NSA and Chain-analysis companies, but not the IRS.

you do know the DCG.. that employed developers in blockstream to make LN and liquid.
https://dcg.co/portfolio/#b  
https://dcg.co/portfolio/#l

are the same company that own chain analyse businesses and exchanges and share info with other businesses.
https://dcg.co/portfolio/#c

using privacy tools. wont hide you from being watched. it will actually HIGHLIGHT you as someone to watch closer
yes all the companies of DCG share their customers data
..
you need to realise they are making privacy tools and trying to break bitcoin not for users needs. but for their business profits and policies of trying to falsely tell people who are not doing illicit things, should use tools that put innocent people onto watchlists, so that they can share information for profit about everyone that they can gather into their service/project

take someone never using a mixer. under coinbase policy it preserves data on only coinbase database.. but if a user was to have a suspicion flag. then they can share that info with its partner businesses and authorities. so they can make profit and sell data by making people look suspicious

just look at the advocates, influencers and fangirls of the blockstream(dcg) community.. they are always the most vocal idiots shouting how bitcoin is broke and everyone should move over to other networks or use middlemen services. they are the ones that say bitcoin cant cope with normal daily use bitcoin by normal people, while then advertising that bitcoin needs to spam up more blocks with mixer data.

realise their motives. its all for selfish profit and greed

did you know that there is big business in finding out info about people
forget about the illegal/legal activity thing.
just 'data mining' in of itself is big business

did you know that exchanges that know what region of a country you live in, value that information ALOT
they can work out your residential electric cost and calculate the mining cost that user would have if they mined to assign that customer a 'market support level' of what they deem as what that person thinks is a good bitcoin price.

EG cheapest mining on planet is about $13k/btc (hardware ROI included)
EG region of america at 12cent electric is about $19k (hardware ROI included)

so by exchanges knowing that this american could be a btc buyer when the price is below $19k and a btc miner(seller) when the price is above $19k becomes valuable info to then collate with other users data to then work out the whims of the 'support levels' of bitcoin market prices

yep just knowing user 123xyz is from 12cent electric region is worth something to analysts
and the DCG know this stuff and share this stuff

they dont care about peoples privacy. they just want to move people into different services they can profit from for different reasons.
privacy guess get syphoned off their value via the fee's of using privacy tools and normal people get their data sold.

[Coyster]

Governments have and will always target privacy, especially when it has to do with financial privacy. Bitcoin's pseudonymous nature is already a pain in the ass for governments obnoxious efforts at tracking people's finances effectively, and then mixers that conceals the relationship between addresses causes them more pain i'm pretty sure.

Developers need to create the kind of privacy feature that can't be abused/misused by criminals including those in government. If you can't develop a privacy application (for example) that is hard to abuse, better not develop at all because you will be creating more problems instead of solving problems without creating more problems.

Absolutely anything that is created in this world can be abused and used by people wrongly, it doesn't mean that what was produced has any inherent/intrinsic problems, it is just what it is. Quite a lot of people erroneously claim that Bitcoin is used for crime and a whole lot of bad things, but that is not true, neither is it what it was created for.

[Upgrade00]

Developers need to create the kind of privacy feature that can't be abused/misused by criminals including those in government.

There is no single utopian system in the world which has not been exploited by bad actors. Banks which are constructs of the government have been involved in numerous illegal activities, some which it has mediated or actually carried out itself.

That's an impossible ask from developers. And the reality is the government does not really care about bad actors or the minority which uses it for illegal activities, the focus is on untraceable movement of assets to acquire more taxes and revenue.

[Leviathan.007]

Mixers are made to increase privacy and keep the transaction anonymous to keep them away from getting tracked by the governments, so, that's very normal to see the governments and not only the US government targeting mixers, because they want to track people as much as they can and mixers are agaist it, that's why it's not surprising to see governments are trying to shut down the bitcoin mixers soon. Generally, it's not new to see the government of the USA is against the mixers.

[franky1]

Mixers are made to increase privacy and keep the transaction anonymous to keep them away from getting tracked by the governments,

take your tin foil hats off

governments do not have offices of employees actively watching all citizens. FACT
governments have rules where BUSINESSES have to watch their customers. and the BUSINESS has to flag customers the business finds suspicious and report only those suspicious people. FACT

try to read some laws, regulations and MSB policies guides

then realise its the businesses that have the watchlists. and then look into how businesses operate.

a business can share information more freely if said business deems their customer is acting suspicious as it then allows them to bypass 'privacy policy' . by which those businesses can make money out of that data.

its the reason that governments say if you got nothing to hide you got nothing to worry about because governments wont ever see or read about you unless you are doing something suspicious that gets reported to them.

they are not actively watching you daily. they sit and wait for businesses and services to report you to them

by using a mixer. that act alone puts a 'suspicious' flag rating on your account with the business.. that business can then investigate you by passing that info around and to authorities to see if you have a criminal record or any previous court charges against you to see if you are a risk.

where as not using a mixer. you dont get a second glance or looked at in depth

[pooya87]

Governments have been after bitcoin and anything related to it ever since 2008 which is before the first bitcoin block was mined! They have been specifically going after anything that has any traces of centralization, that includes all the services like exchanges, altcoins that are centralized and obviously centralized mixers. In other words if they could shut them down, they would have already done it. Doesn't mean they are going to stop though.

[The Cryptovator]

It's pretty normal governance doesn't like hiding your funds or income. So they will try to prevent you from using a mixer. I am not sure if the US can shut down mixers from any other country where Bitcoin is legal tender like El Salvador. Or can they shut down if it's operating through onion? I can't recall but have seen the government close and takeover the mixer site before. So it's possible they will attack the Bitcoin mixer as well. But for sure, people will discover something to hide their privacy.

[Lucius]

Governments have been after bitcoin and anything related to it ever since 2008 which is before the first bitcoin block was mined! They have been specifically going after anything that has any traces of centralization, that includes all the services like exchanges, altcoins that are centralized and obviously centralized mixers. In other words if they could shut them down, they would have already done it. Doesn't mean they are going to stop though.

Judging by what was revealed to us by the largest defector in recent American history, it is clear that they harnessed very large resources to deal with the Bitcoin problem. I would not even expect a different approach from all those who fight in every way to centralize society as much as possible, and Bitcoin is a thorn in their side, even though it has been proven many times that when it comes to financing terrorism or money laundering, Bitcoin is quite negligible in every sense.

If Bitcoin is a problem for them, then there is no doubt that mixers are something that is considered a legitimate target - although for every one they manage to shut down, there are at least 2 new ones. The problem for users is that there are many more fake ones than legitimate ones, which is another story...