Cryptocurrency Flowing Into 'Mixers' Hits an All-Time High (arstechnica.com) 55
The amount of cryptocurrency flowing into privacy-enhancing mixer services has reached an all-time high this year as funds from wallets belonging to government-sanctioned groups and criminal activity almost doubled, researchers reported on Thursday. ArsTechnica: Mixers, also known as tumblers, obfuscate cryptocurrency transactions by creating a disconnect between the funds a user deposits and the funds the user withdraws. To do this, mixers pool funds deposited by large numbers of users and randomly mix them. Each user can withdraw the entire amount deposited, minus a cut for the mixer, but because the coins come from this jumbled pool, it's harder for blockchain investigators to track precisely where the money went. Some mixers provide additional obfuscation by allowing users to withdraw funds in differing amounts sent to different wallet addresses. Others try to conceal the mixing activity altogether by changing the fee on each transaction or varying the type of deposit address used. Mixer use isn't automatically illegal or unethical. [...].
"Mixers present a difficult question to regulators and members of the cryptocurrency community," researchers from cryptocurrency analysis firm Chainalysis wrote in a report that linked the surge to increased volumes deposited by sanctioned and criminal groups. "Virtually everyone would acknowledge that financial privacy is valuable, and that in a vacuum, there's no reason services like mixers shouldn't be able to provide it. However, the data shows that mixers currently pose a significant money laundering risk, with 25 percent of funds coming from illicit addresses, and that cybercriminals associated with hostile governments are taking advantage." Cryptocurrency received by these mixers fluctuates significantly from day to day, so researchers find it more useful to use longer-term measures. The 30-day moving average of funds received by mixers hit $51.8 million in mid-April, an all-time high, Chainalysis reported. The high-water mark represented almost double the incoming volumes at the same point last year. What's more, illicit wallet addresses accounted for 23 percent of funds sent to mixers this year, up from 12 percent in 2021.
"Mixers present a difficult question to regulators and members of the cryptocurrency community," researchers from cryptocurrency analysis firm Chainalysis wrote in a report that linked the surge to increased volumes deposited by sanctioned and criminal groups. "Virtually everyone would acknowledge that financial privacy is valuable, and that in a vacuum, there's no reason services like mixers shouldn't be able to provide it. However, the data shows that mixers currently pose a significant money laundering risk, with 25 percent of funds coming from illicit addresses, and that cybercriminals associated with hostile governments are taking advantage." Cryptocurrency received by these mixers fluctuates significantly from day to day, so researchers find it more useful to use longer-term measures. The 30-day moving average of funds received by mixers hit $51.8 million in mid-April, an all-time high, Chainalysis reported. The high-water mark represented almost double the incoming volumes at the same point last year. What's more, illicit wallet addresses accounted for 23 percent of funds sent to mixers this year, up from 12 percent in 2021.
"Mixer use isn't automatically illegal or unethica (Score:1)
Mixer use isn't automatically illegal or unethical.
This is what you say when you want it to be illegal and unethical.
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If they know I bought a candy bar - they know to much.
Yes, that's knowing too much. But knowing you moved a million pounds around is quite reasonable.
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Yes, that's knowing too much. But knowing you moved a million pounds around is quite reasonable.
No it isn't - it's not there damn business. Unless I'm doing something illegal like buying a million dollars in cocaine, it's not their business. It's not the million dollars changing hands that is a problem, it's the cocaine side of the transaction.
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No it isn't - it's not there damn business.
In most countries, taxation definitely is "government's damn business".
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Re: "Mixer use isn't automatically illegal or unet (Score:2)
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So is using goods and services without paying.
You do have the option of being dropped off on the side of the Alaska Highway and wandering into the bush and living without taxes or services but I get the idea that you'd rather steal and claim it was your hard work (and theft can involve hard work) why you are successful.
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Taxation is paying for the services you use every day but don't pay directly for. Roads, police, military protection from hostile countries, schooling, and many many others.
Re: "Mixer use isn't automatically illegal or unet (Score:2)
This American obsession of government is weird. I highly doubt any government gives a crap about your candy bar.
Cocaine I can argue I don't care either as it's private business what someone else does as I am in favor of legalization.
I am in favor of the government knowing and tracking down criminals tracking stolen money. You would be whistling a different tune if someone stole your Mom's life savings and moved them into crypto mixers to hide it if the FBI was trying to add it back
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It isn't the authorities. I don't want some ex to know 20 years from now that I bought a set of leg irons from Handcuff Emporium, so they don't use that in a court of law. Blockchains are forever, and wanting privacy is not just for criminals. Otherwise, the "Only criminals hide stuff" argument will apply, which is absolute bullshit.
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Then pay cash. Or hold your head high and refuse to be shamed for your alternate lifestyle.
Gov't gets to decide if mixer illegal (Score:3)
Mixer use isn't automatically illegal or unethical.
More importantly the government gets to decide that. So in a particular legal jurisdiction using a mixer could very well be illegal
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Mixing seems to be one of those things like BitTorrent that has both legal and illegal uses. BitTorrent is a very effective way to distribute very large files and companies like Blizzard use it to push out game updates which could be 1GB+. But we also have to acknowledge that BitTorrent is used rampantly to share pirated content as well. Mixing can help hide individuals from tracking and spying by governments for both criminals and the public. People seem to forget that every single transaction in blockchai
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Mixing is pretty expensive. You have to pay a bunch of transaction fees, as well as the fee of the mixer themselves. And since mixing is pretty expensive, usually the only people who do it are people who have to. Which means the mixer's fee is pretty high. Which makes mixing even more expensive.
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I have wondered why people don't just shift their currency to Monero or DASH, then move it back to another BTC wallet. If one doesn't use the same amounts, it would be effectively untracable.
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Honestly, if these things want to exist, they need to exist in a way that makes laundering expensive or prohibitive. Like there are many legit cases (from buying weed or tampons) to grey areas (abortion services, plastic surgery, legal services, etc) to outright illegal (murder for hire, ghost firearms) that crypto gets used for, and these services know they are illegal.
The simplest way to deal with it is to hold the mixing service liable for any illegal activity as though the (illegal) service was provided
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25% (Score:2)
Preparing to cash out (Score:3)
It says to me some people are preparing to cash out.
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Agreed. It reads that people are wanting to convert their unusable digital 'currency' into actually usable fiat currency. But likely fall into categories of:
-I am laundering illegally obtained coins..a la ransomware, darkweb, etc
-I am tax dodging
-I am running a pyramid scheme crypto/defi/nft company and am basically going to declare bankruptcy and screw my customers, but want to keep their money for myself secretly.
Bit torrent is a good comparison. Sure we can sit here in Slashdot and talk all day about
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marijuana should just be legal
It basically is in San Francisco. To purchase limited amounts at a time, you no longer need a medical marijuana card, just an ID (like at a bar or liquor store).
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marijuana should just be legal
It basically is in San Francisco.
Unless the feds are after you for some reason. Then its an additional charge.
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are there any mixer scams? (Score:4, Interesting)
Seems like once you hand over your money to go into a pool, it's possible for them to just not give it back. Especially since it isn't an instantaneous transaction. New scam idea: create a mixer and advertise it heavily. Walk away when the pool of funds reaches $100m or so.
Re:are there any mixer scams? (Score:5, Interesting)
I'd give it 6 months before losses start happening.
I'm actually surprised it hasn't happened yet, but I guess the people who launder money are the same people you don't want to steal from.
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I suspect that the actual truth is that the NSA is running most mixers, and they are happy to use it to watch illegal flows of money. It would be straightforward for them to use this information to gather evidence that wouldn't implicate the mixers that they have compromised.
Re: are there any mixer scams? (Score:2)
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Seems like once you hand over your money to go into a pool, it's possible for them to just not give it back. Especially since it isn't an instantaneous transaction. New scam idea: create a mixer and advertise it heavily. Walk away when the pool of funds reaches $100m or so.
But then you need to mix the stolen loot to wash it. :-)
Re:are there any mixer scams? (Score:4, Insightful)
Well, you could. Problem is, you're ripping off criminals. Many of them probably of the nasty variety.
On the other hand, you could just set up an exchange and do the same thing. Then most of your customers are going to be random geeks.
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Yeah, creating a business catering to criminals and then ripping them off may seem glamorous, but these are nation-states and rich criminal enterprises that probably have the resources and patience to find you. I don't particularly think being found limb-less and rotting in a hole somewhere to be that glamorous, but I suppose the crime scene photos of the recovery being posted on a 4chan gore thread is glory in its own right?
If there are you'll never hear about it (Score:2)
If anything it's a bad sign to see the law being called in on some of these crypto companies as they implode. It shows this nonsense is bleeding over into the broader financial markets you and I occupy. I'm literally seeing "crypto IRAs". I can't think of anyth
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Seems like once you hand over your money to go into a pool, it's possible for them to just not give it back.
The problem is that no one with a $1B in crypto will hand you the entire stash. They will break it into thousands of chunks and feed them one at a time into the mixer service.
So if you steal 0.1%, you will make LESS MONEY than if you provide a proper mixing service for a 1% fee.
At least in this situation, crime doesn't pay.
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One of the things a mixer needs is a pool of money from multiple sources. And some time to work its concealment transactions. If a criminal comes with a billion to a small mixer there is no point, it won't be able to hide anything. If a thousand different criminals show up then you have some possibility of making the mixer work. I propose that flaw in this is the technological marvel of cryptocurrency doesn't eliminate the need for a criminal to trust their money launderer.
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Eliminate all drug crime instantly! (Score:1)
Eliminate all drug crime instantly!
Legalize drugs. ALL drugs. Then the need for shit like this goes the fuck away.
Society becomes more peaceful, fewer people are imprisoned, the world is instantly a better place.
Mixers and laundrier are low fruit (Score:4, Insightful)
Mixers do make it harder to track, not impossible. Blockchain being a ledger, following the flow is quite easy so long as you have the power to churn through it. Mixers put logical breaks in the flow the same way general slush funds are great ways to doff with some public funds. So while it does indeed make it a bit harder, you aren't putting on some cloak of invisibility.
Moreso, mixers and their pop up collectivism nature make them especially ripe for the exact same reason pooling money of any sort without massive oversight is bad. If you are a bad guy and you are pooling money, you want to make sure the pool you're putting into is watched over by the very least a neutral person who is going to give you back your cut.
Add this whole, "trust" thing with the notion, anyone can set these mixers up, and the semi-anonymous nature that needs to be had. It's not exactly going to be a "you know what you're getting into" kind of thing ahead of time. And that means this has a lot of room for abuse, much like any unregulated thing. But you know, at this point these crypto idiots have lost billions so far. If they haven't learned from that, then they just won't or don't want to learn. I get the attraction of being free of the man, but I mean the whole "having legal recourse" thing means a lot to me, especially in the age of the grift we're all living in.
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Add this whole, "trust" thing with the notion, anyone can set these mixers up, and the semi-anonymous nature that needs to be had. It's not exactly going to be a "you know what you're getting into" kind of thing ahead of time.
Such as a government honepot for identifying people who need to wash their money.
I read the article & the "study" article it li (Score:2)
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It's perfectly possible to know that an address has received stolen funds without knowing who stole them or who owns the address.
'financial privacy is valuable' (Score:1)
Everyone will agree publicly. Privately, no way.
CBDC is what they want. To control the money is to control the people. Trudeau showed the future game plan during the Canadian protests.
Given the inherent "security" of most cryptocoins (Score:2)
I expect we'll start hearing about people taking advantage of these "mixers" to steal large amounts of money in the reasonably near future. I imagine it's probably happening already, but criminals dislike publicizing when they themselves get ripped off.
Too many outlaws (Score:1)
Dread Pirate Roberts again? (Score:2)
Inigo, stop it!
wait till they hear about monero (Score:1)
XMR and crypto like it address the privacy side of this quite well. No need for the risk or expense of using a mixer.
Mixers are for amateurs (Score:2)
Re: Mixers are for amateurs (Score:2)
One scammer got caught converting stolen Bitcoin to monero and an investigator caught the kids in the UK