What Are Crypto Mixers and How to Choose the Best One
crypto basics
Whether you're an investor, miner, or simply a crypto enthusiast, chances are that you’ve heard of the term “crypto mixers.” This service makes it more difficult to trace the source of users’ funds, which makes it popular for people looking to remain anonymous when trading.
But how do crypto mixers work exactly? Are they legal, and are there any alternatives to them? If you need answers to these questions, you’ve come to the right place. This article will tell you all about crypto mixers and provide you with a list of the best ones out there!
What Are Crypto Mixers & How Do They Work?
Crypto mixers, or tumblers, represent one of the most popular tools that can be used to keep crypto transactions private by hiding senders’ and recipients’ information.
For example, Bitcoin’s blockchain is entirely public, which means you can find a record of all transactions ever since the cryptocurrency’s launch back in 2009. Although some people like this feature, for others, this lack of privacy is a problem. And that’s where tumblers come in.
Essentially, the crypto mixing process starts when the cryptocurrency owner sends their funds to a crypto mixing service. This service “shuffles” their money with that of other crypto users. The “mixed” funds are later withdrawn to a new address, and the public explorer will only show that they had been sent to the mixer used. This way, the transaction remains completely hidden.
As no one can identify the mixed crypto funds and there is no Know Your Customer (KYC) requirement, there are instances of people using tumblers in all the wrong ways. Hence mixers are used for money laundering, especially in the online gambling industry, where there’s a constant flow of money and, as of late, digital assets.
Types of Crypto Mixers
There are two most common types of crypto mixers:
- Centralized mixers
- Decentralized mixers
We’ll cover them in depth in the following section.
Centralized Mixers
Centralized mixers represent companies that accept to take your cryptocurrencies and send back different ones in exchange for a specific fee. Choosing one of these is both the simplest and cheapest way of hiding your crypto transactions, but there are still some challenges associated with it.
For example, cryptocurrencies that are “mixed” with centralized mixers are easier to detect by third parties because the mixer keeps a record of transactions. These tumblers usually have access to your Bitcoin and IP addresses, which they may sell or share (if they are obligated by law).
Decentralized Mixers
Decentralized mixers are peer-to-peer mixing services that operate on advanced blockchain platforms. The most popular protocol, CoinJoin, improves the privacy of decentralized mixers, which is a huge plus compared to centralized ones.
Essentially, it coordinates the input of multiple users into a single transaction that is obscured by multiple outputs and origins of coins. It can even prevent the mixer service from figuring out where the coins went.
This approach allows a group of people to gather a specific amount of crypto funds that will then be redistributed to each participating member. This way, everyone who contributes to the pool receives a fair amount of crypto funds and doesn’t have to rely on third-party services.
Are Crypto Mixers Legal?
There is no definite answer to whether crypto mixers are legal, as the laws regulating their use are different in every country. For example, The US Department of Treasury (DOT) has stated that the use of mixers for money laundering purposes is illegal and punishable by law.
There was also the Amsterdam incident, where an individual was arrested for developing Tornado Cash, a mixer that’s used specifically for purposes banned by the US DOT. Tornado Cash is essentially used to hide stolen digital funds and was first used by a North Korea-based hacker group.
However, the Financial Crimes Enforcement Network (FinCEN) has stated that individuals or businesses offering crypto-mixing services can do it legally if they register as money transmitters under the Bank Secrecy Act (BSA). To do so, they must register with FinCEN, have an anti-money laundering system in place, and meet all the reporting and record-keeping requirements.
Crypto Mixers Alternatives
Besides crypto mixers, there are also several other methods crypto users implement to conceal their transactions.
The most popular option is so-called “chain-hopping,” which represents trading cryptocurrencies via anonymous exchanges in order to make the transaction harder to track. It can also be done by using specific coins that provide extra anonymity and that can’t be tracked by authorities so easily.
Even though chain-hopping with privacy coins is a viable option for hiding your transactions, this option is typically used by cyber criminals, so you should definitely avoid it if you don’t want to break the law.
How to Choose a Crypto Mixer
If you’re looking for a suitable crypto mixer, chances are that you’re stuck, as there’s an abundance of them on the market. Here are several factors you should keep in mind when choosing one for yourself:
- Security. Always go with the company that has significant experience under its belt, as it’s your funds that are at stake. It should have a solid reputation, and it shouldn’t store any information about users or their transactions. Nowadays, most top-tier mixers have temporary data storage, which is required for deal completion.
- Speed. Another important criterion is speed, as you don’t want your chosen platform to take several hours or days to mix your coins. Instead, find a company that will do it in an instant.
- Withdrawal delay. Generally, most crypto mixing services will offer you a standard delay that you cannot change. However, you should find a company that gives you full control over the withdrawal process so that you can instantly withdraw your funds or postpone it for later.
- Mixing code. A mixing code ensures that you don’t receive coins previously sent into the mixer and that the following transactions contain exclusively new coins that cannot be tracked. Hence, look for a company that uses it.
- Fees. Lastly, you should research the fees that come with the service of crypto mixing that a company offers. Generally, commission for tumbling ranges from 1% to 3%, depending on the transaction amount.
6 Best Crypto Mixers
Now that you’re familiar with what crypto mixers are and know what to look for in them, let’s go over the top 6 crypto mixers in the industry.
#1. Sinbad.io
If you’re looking to transfer Bitcoin, you might want to take a look at Sinbad.io. One of the reasons why this crypto mixer is one of the best Bitcoin mixers in the industry is its no-logs policy. Thanks to this feature, the details about the cryptocurrency transactions you make disappear one hour after mixing is done, leaving no trace of your activity.
This crypto mixer also comes with a guarantee letter, which allows you to solve any issues related to the service more easily. The only issue with it is that it’s still a new service, so there’s still much room for improvement. Still, the good news is that it offers loads of great features, such as:
- Fast payouts
- Mixing code
- Availability in Tor
- Reliable customer support
- Solid BTC reserves
- Multilingual web interface
- Customizable delay and distribution of payout amounts
#2. Unijoin
Whether you’re a seasoned veteran or a beginner when it comes to tumbling, UniJoin might be the service provider you’re looking for! It has a friendly user interface, making it perfect for new people, and it offers a lot of features for advanced users, such as user-controlled time delays.
Another selling point of Unijoin is the fact that it doesn’t require you to use a VPN, and it also gives you a mixing code, which is always a plus. Some other notable features of Unijoin include:
- Low minimum transaction limit
- Randomized addresses
- Quick payouts
- Fair transaction fees
- Positive experiences of the Bitcoin community members related to it
- Up to 8 Bitcoin payout addresses
#3. Wasabi Wallet
Wasabi Wallet represents another reputable crypto mixer in the form of a free, open-source crypto wallet. It’s a piece of software you can install on your computer—it’s available for Windows, Linux, and OSX—but it can’t be used on a mobile device.
The mixer features a specific “shuffling mechanism” that connects the details from multiple crypto transactions into a single transaction with many outputs. Besides this amazing feature, Wasabi Wallet also:
- Uses automatic Tor integration
- Enables users to configure the software according to their needs thanks to its open-source nature
- Has a block filter that hides the IP addresses, making them invisible in the Bitcoin network
#4. Coinomize
With over 2 million Bitcoins mixed since its launch, Coinomize remains one of the most popular crypto tumblers in 2023.
This crypto mixer is a web-based platform, meaning you don’t have to download any additional software to use it. Additionally, privacy is on the maximum level, as the platform allows you to choose whether you want to delete the transaction data yourself or let the platform do it for you.
One of the main selling points of Coinomize is the user-controlled fund distribution mechanism, but it also offers you a guarantee letter that confirms the Bitcoin address is legit. Even if there are any issues or questions related to the way Coinomize operates, you can create a ticket, and the company’s customer support service will get back to you with a solution.
Some other notable features this crypto mixer offers include:
- No-registration policy
- Solid time delays
- Low minimum deposit
- High anonymity status
#5. Whir
Whir is a crypto mixing service provider that utilizes the previously-mentioned method called CoinJoin. It offers instant transactions, but you can also choose to receive mixed cryptocurrencies with a slight delay to enhance the privacy of your transaction.
More importantly, Whir also has a super intuitive interface and is quite easy to use. You don’t have to download any apps—all you have to do is visit the company’s official website and mix whatever coins you like.
Here are some more crucial Whir features you should consider:
- Transaction logs deleted 24 hours after mixing
- Instant mixing service
- Time delays users can control
#6. Samourai
If you’re looking for a feature-packed crypto mixer, look no further than Samourai. This tumbler offers a high degree of anonymity, supports up to 10 different payout addresses, and allows you to manually delete logs before the auto-clear period.
What makes Samourai different from its competitors is that its services aren’t charged based on volume, but the company charges a flat fee instead. This means that you pay the same to mix 1 BTC or 100 BTC. Some other features you may notice in Samourai include:
- No registration required
- 24-hour time delay
- Allows custom fee placement
- Low minimum transaction limit
Key Takeaways
If you’re looking to hide your identity while making crypto transactions, especially if it's Bitcoin, your best bet to do so would be to use crypto mixers. Depending on your specific needs, you’ll be choosing from a centralized or a decentralized mixer.
Hopefully, this article has provided you with all the details you need to know about crypto mixers. At the end of the day, you can always consult our top 6 list and choose some of the best tumblers out there!
Crypto Mixer FAQ
#1. What is crypto mixing?
Crypto mixing is a service that “shuffles” different streams of cryptocurrencies to help crypto users hide their transactions from third parties and allow them to keep their anonymity when buying or selling cryptocurrencies. Their transaction details will be mixed with multiple other pieces of information belonging to other crypto users, which will make them undetectable.
#2. What are the best crypto mixers?
What crypto mixer would work best for you mostly depends on your needs and the level of anonymity and security you’re looking for. However, according to the newest reviews, the most popular tumblers in 2023 include Sinbad.io, Unijoin, CryptoMixer, Coinomize, Whir, and Samourai.
#3. How to use crypto mixers?
All you have to do when using a crypto mixer is send your cryptocurrency to a specified mixer address instead of the recipient’s address. The mixer will “shuffle” your transaction information with other users’ transaction details and send different cryptocurrencies to their destination without leaving any trace.