What is a crypto mixer?
Crypto mixers are services that allow you to “mix” your crypto so that it is impossible to track.
Imagine you are at a big party, where everyone takes a handful of coins out of their pocket and throws it into a common bowl.
Then, everyone randomly draws a few coins, which, of course, do not belong to them. This is similar to what a cryptocurrency mixer (or tumbler) does.
Let’s look at an example:
Let’s say Alice has 1 Bitcoin she received from Bob and wants to spend it somewhere. But she doesn’t want anyone to be able to track where this Bitcoin is stored and that it belongs to her. Therefore, she uses a cryptocurrency mixer.
This mixer takes Alice’s Bitcoin and mixes it with a lot of other Bitcoin from different people. Then it sends 1 Bitcoin (not the original one, but one of those that were mixed) to the address specified by Alice. So, now, if someone tries to track down the Bitcoin spent by Alice, it will end up in the mixer and get lost in thousands of transactions.
So, why do people need this?
You already know that most cryptocurrencies are not completely anonymous and that your transactions can be tracked through a blockchain explorer.
This means that, without using tools like mixers, your transactions can potentially be tracked.
Thus, mixers are important tools in the search for privacy in the cryptocurrency world.
Of course, we gave the most harmless example of “mixing” coins. In fact, mixers are quite often used by scammers who want to “launder” money.
Crypto mixers are services that allow you to “mix” your crypto so that it is impossible to track.
Imagine you are at a big party, where everyone takes a handful of coins out of their pocket and throws it into a common bowl.
Then, everyone randomly draws a few coins, which, of course, do not belong to them. This is similar to what a cryptocurrency mixer (or tumbler) does.
Let’s look at an example:
Let’s say Alice has 1 Bitcoin she received from Bob and wants to spend it somewhere. But she doesn’t want anyone to be able to track where this Bitcoin is stored and that it belongs to her. Therefore, she uses a cryptocurrency mixer.
This mixer takes Alice’s Bitcoin and mixes it with a lot of other Bitcoin from different people. Then it sends 1 Bitcoin (not the original one, but one of those that were mixed) to the address specified by Alice. So, now, if someone tries to track down the Bitcoin spent by Alice, it will end up in the mixer and get lost in thousands of transactions.
So, why do people need this?
You already know that most cryptocurrencies are not completely anonymous and that your transactions can be tracked through a blockchain explorer.
This means that, without using tools like mixers, your transactions can potentially be tracked.
Thus, mixers are important tools in the search for privacy in the cryptocurrency world.
Of course, we gave the most harmless example of “mixing” coins. In fact, mixers are quite often used by scammers who want to “launder” money.