A cryptomixer is a service that allows individuals to protect their privacy by obfuscating the link between their cryptocurrency transactions and their real-life identity. It works by sending cryptocurrencies to a mixer, which then mixes them with other coins, obfuscating their links to each other and making it more difficult for outside parties to associate them with the users’ identities or activities. While crypto mixers have transformative potential, they also attract significant attention and can be linked to illicit activity, such as money laundering and tax evasion.
While mixers weren’t initially designed for criminal purposes, they are now widely used to launder ill-gotten cryptocurrency profits and conceal stolen crypto assets. This has attracted the attention of regulators, who have imposed strict requirements for mixers to comply with anti-money laundering and other laws in order to remain operational.
Nevertheless, many people use mixers to support a variety of social causes and political movements, such as activists in oppressive regimes. They want to be able to make donations without the risk of their personal details being revealed on the blockchain, especially if they live in countries that don’t grant citizens the same rights and freedoms.
Custodial mixers are centralized services that store users’ wallet information and funds. This single point of failure makes them vulnerable to hackers and puts their data at risk, which could be used to expose users’ identities and financial data. Additionally, they may not follow best practices for preserving user privacy. cryptomixer