18 ms·

Tracking Mixed Bitcoins

98 points by adulau 6y ago

peteretep 6y ago
Doing anything illegal with transactions on a public ledger strikes me as foolhardy.
- uHuge 6y ago
  You get the pseudonymity and open/easy access there on the other hand.
  - peteretep 6y ago
    > pseudonymity I worry that many people are confused by this, and don’t understand that this will continue to get eroded as time goes on for completed transactions.
    - shadowprofile77 6y ago
      Could you explain a bit more about what you mean by that? My interpretation is that even if you completed a bunch of BTC transactions in a way that allowed you to maintain anonymity, over time, new methodologies or technologies will allow future investigators to trace you as a real person through those old transactions. This? Or something else?
      - hnthrower 6y ago
        That's the just of it. Many of these public ledgers, like Bitcoin, form a massive transaction graph. Blockchain analytics tools and companies de-anonymize nodes in these graphs by matching real-world transactions to blockchain transactions.
        jlgaddis 6y ago
        > just gist (in case you've ever wondered why gist.github.com is so named)
      - peteretep 6y ago
        Yes that’s what I meant — my interpretation is the same as yours
    - londons_explore 6y ago
      And if you use a mixer or complex wallet setup to try and hide your identity, you are highlighting yourself in the future when more advanced analysis methods start to get used.
- ravingraven 6y ago
  It is much much smarter compared to any electronic alternative. It is actually the smartest way to do it if done correctly. Only people who do not understand crypto say stuff like that.
xiphias2 6y ago
It's extremely hard not to taint addresses in Bitcoin. As an example if you have a Trezor (which makes using Bitcoin safe and easy) and buy another one as a backup, you can't export your private key from the original one, but you can easily send all Bitcoins to a new address. The only option you have is to get the paper backup (which is guarded somewhere physically separated from your Trezor) and use that to initialize the new device.
- wcoenen 6y ago
  That's just how wallet backup works, I'm not sure how that is related to taint. Perhaps a better illustration of the taint issue is "change". Whenever you need to send an amount of bitcoin that does not exactly match one of the UTXOs ("unspent transaction output") in your wallet, you will - potentially need to use multiple UTXOs as input (thus linking together the past transaction that produced them) - very likely have a "change" output that sends the excess amount back to a new address in your own wallet. Which output is change can be guessed with heuristics, and that UTXO will eventually be used in a future transaction, linking it to the current transaction. Basically, all transactions associated with a wallet tend to become linkable over time.
  - xiphias2 6y ago
    I think you don't have experience with the Trezor. It uses BIP32 wallet (hierarchical deterministic wallet) which derives the private keys from one master seed stored on the device. Older wallets could import separate private keys, but Trezor doesn't have this feature. If you want to move to a new device without having access to the master key, you need to make a transaction that connects all addresses (both inputs and change addresses). It's not just ,,linkable over time'', it means that you link all UTXOs in 1 transaction. What you are wrighting is also a problem, but different from what I had in practice.
    - wmf 6y ago
      If you want to import N UTXOs into a Trezor you can generate N fresh addresses and use N independent transactions to move the money over. Then you have to be careful about joining those UTXOs later. I'm not aware of any wallet that allows this, but it's theoretically possible. I think the advantages of the BIP32 model are worth it considering how many people lost private keys in the old wallet.dat model.
porcine-flight 6y ago
The key assumption which underlies tracking UTXOs is that the people sending UTXOs to each other have some sort of real-world relationship and they are both using the same blockchain. But this is not necessarily true. Two strangers could meet anonymously in an online chat and agree to trade e.g. Bitcoin for Ethereum using a cross-chain atomic swap. In this case the transactions occur on two separate chains, and any available metadata is likely very hard or perhaps impossible for a third party to discover.
- nickthemagicman 6y ago
  As a noob to this stuff, what if BTC was sent through a Monero chain? Isn't Monero purported to be super anonymous?
  - porcine-flight 6y ago
    Monero uses special techniques to obfuscate activity on its chain, increasing the cost of chainanalysis significantly. However, for an attacker that is well funded (e.g. NSA) it's likely a very small challenge to overcome. Besides brute-force tracking of the chain, a clever way to track cryptocurrency users (including Monero users) is to add backdoored cryptocurrency wallets/apps into app stores and capture the data at the point it is created, just as Facebook/Whatsapp capture keystroke input in realtime. This is probably even cheaper than breaking Monero's obfuscation techniques, and also works well against better privacy technologies such as Zcash.
    - DarthGhandi 6y ago
      > However, for an attacker that is well funded (e.g. NSA) it's likely a very small challenge to overcome. Yeah that's a solid "citation needed", you are talking about breaking serious cryptographic assumptions there.
      - vmception 6y ago
        > and also works well against better privacy technologies such as Zcash. It's not even worth responding to this person. I'm not sure there is an educational moment with people like this. For the record, to anyone passing by, I and many others view things in the opposite way. Zcash is less private, it operates in two states with the default state being just like bitcoin, with a separate state having opt-in privacy. Many/most Zcash users think they are using the opt-in state by default which is unfortunate. The Zcash opt-in state is not as anonymous as Monero and is easier to deanonymize and harder to use best practices to thwart. Zcash is developed and run by a US based company which can be much more easily coerced than a distributed team like Monero has doing open source work that collectively funds development when necessary. Zcash organization has budget for advertisement. It is suspicious that Zcash followers present an alternate reality so opposite to this that it is gaslighting, and does exactly what people are worried a centralized VC backed US based company would do.
seibelj 6y ago
Monero is quite anonymous, and https://xmr.to/ https://xmr.to/ allows you to send small amounts of Monero and have them send Bitcoin for you. Just one solution of many to preserve privacy!
- vmception 6y ago
  and by small, we mean 2 BTC per order, which is $21,600 at time of writing. no limit on distinct orders. Americans just turn on your VPN to access the frontend website, the server and operator don't actually care.
- giancarlostoro 6y ago
  > Sorry... > XMR.to is currently not available in your region. I guess no Americans allowed
  - deleted 6y ago
    [deleted]
  - RandomBacon 6y ago
    That's just based off of IP...
    - giancarlostoro 6y ago
      I'm sure it is, but I just wanted to window shop and see what they even had to offer for myself, now I'm just walking away.
- heimatau 6y ago
  > Monero is quite anonymous Don't trust, verify. [1] [1] - https://monero.org/monero-vs-princeton-researchers/ https://monero.org/monero-vs-princeton-researchers/
nubela 6y ago
If you care about privacy, don't use Bitcoin or any coins for that matter for which privacy is not default. Look at Monero instead.
- apples_oranges 6y ago
  Or look at cash. :)
  - t0astbread 6y ago
    I'm gonna add gift cards paid for with cash to that
HashingtheCode 6y ago
Bitcoin mixers aren't private as the real transaction is in the mix-set somewhere and it is really a matter of time until a determined researcher will find it. Mixers work better the higher number of coin-joins in the mix, and it is better than nothing in that sense, but it gives users a false sense of privacy. Privacy can be had in obfuscating your Bitcoin by sending them using the Lightning Network. You have your own LN Channel and then send them to yourself routing through as many other channels as possible. Bitcoin cleaned. https://bitcoinmagazine.com/articles/how-the-lightning-network-layers-privacy-on-top-of-bitcoin-1482183775 https://bitcoinmagazine.com/articles/how-the-lightning-netwo... Another way is to use ZCoin. Zcoin uses zero knowledge proofs which burns the minted coin and redeems a new coin. SO I convert my 0.5 Bitcoin to Zcoin, the orginal transaction iin Zcoin is burned and new equivalent Zcoin is minted. No trace. Monero is good but it is now under attack by Chainalysis to crack it on behalf of the IRS. https://cointelegraph.com/news/chainalysis-and-texas-firm-win-million-dollar-irs-contract-to-crack-monero https://cointelegraph.com/news/chainalysis-and-texas-firm-wi... When it comes to anonymity from the solutions available; coinjoins, Monero or Zcoin, personally Zcoin seems the most private way to obfuscate one's blockchain trail.
- RandomBacon 6y ago
  A Zcash user recently made a challenge for anyone to tell where his coins came from that went from taddress->zaddress->zaddress->taddress. The winner only had to look at past public transactions and find the same coin amount to find the original t-address. That is why privacy-by-default is very important, and why right now Monero should be considered more private. Monero has been "under attack" for a long time now, well before the IRS started giving money out. There are possible attack vectors and subsequent remedies. The Monero people made a series called Breaking Monero where they talk about all of that stuff.
  - ianmiers 6y ago
    Zcash and Zcoin are two very different things run by very different groups with very different protocols. The poster was talking about Zcoin, and you responded with a canned line about Zcash.
shiado 6y ago
Does anybody know of any papers about attacking coinjoins? From what I understand Wasabi + TOR is still the gold standard of Bitcoin mixing.
- RandomBacon 6y ago
  Chainanalysis released a publication saying they can trace coins that went through CoinJoin.
  - blake8086 6y ago
    Was it https://news.bitcoin.com/chainalysis-whistleblower-shares-company-secrets-in-explosive-ama/ https://news.bitcoin.com/chainalysis-whistleblower-shares-co... ?
    - RandomBacon 6y ago
      No, and I wouldn't necessarily trust an anonymous whistleblower without proof. This is what I was referring to: https://blog.chainalysis.com/reports/introducing-chainalysis-investigation-compliance-support-dash-zcash https://blog.chainalysis.com/reports/introducing-chainalysis... > the exact same techniques that can be used to analyse CoinJoin transactions performed using Bitcoin can be used on Dash.
katsume3 6y ago
Since Bitcoin is not fundamentally private, any attempt to tumble your BTC is fruitless because the Bitcoin blockchain and every transaction is public and transparent. There are even companies like Chainalysis[0] who profit off this fact and help law enforcement with e-crime. I imagine if Satoshi wanted to do Bitcoin again, she would bake in privacy as a core feature? [0] https://www.chainalysis.com/ https://www.chainalysis.com/
- jmt_ 6y ago
  Possibly not. Satoshi likely did not intend nor desire their currency to be used to facilitate crimes. In fact, they were infamously weary of WikiLeaks using the currency for donations due to the legal issues surrounding them, and WikiLeaks "crimes" are not comparable to say arms trafficking or something substantially illegal. The public nature of the BTC blockchain helps facilitate decentralized, equal participation.
  - thaumasiotes 6y ago
    > Satoshi likely did not intend nor desire their currency to be used to facilitate crimes. This is certainly false; the whole point is to invalidate money transmission laws.
    - jmt_ 6y ago
      One can "invalidate" money transmission laws without committing crimes.
      - thaumasiotes 6y ago
        How?
        jmt_ 6y ago
        Use Bitcoin for legitimate purchases?
intotheabyss 6y ago
If you care about privacy, use Ethereum and zero knowledge proof mixers like tornado.cash.
- antonios 6y ago
  There's already a privacy-focused coin that isn't a total mess. And no premines. And no mixing hoops to go through. So, why use Ethereum?
  - intotheabyss 6y ago
    Because everything is on Ethereum. Once you're in the Ethereum eco-system, there's no reason to leave. Once you're in Ethereum, then you can do whatever you want. Trade on DEXs, do swaps, lend, borrow, leverage, stablecoins, zk mixing, farm liquduity tokens, etc. Once you use Monero, if you ever want to do anything useful with your crypto, you're going to have to inject it into the Ethereum ecosystem, and that inherently means interacting with a CEX. So why not skip that step and just deposit your crypto into tornado.cash and wait for the pool to be sufficiently mixed. That way, you never need to interact with a CEX to actually use dapps on Ethereum.
    - finnomenon 6y ago
      Welcome to zombocom.
      - RandomBacon 6y ago
        https://html5zombo.com https://html5zombo.com
    - ChrisClark 6y ago
      That's true. It would be great to see some more variety in chains being used, but right now everything is being done on ethereum. We need some more bridges to other chains, otherwise there is no reason for anyone to spread out.
clarkmoody 6y ago
This paper is about tracking Bitcoin through centralized mixing services. There is no mention of coordinated CoinJoin services, like Samourai Whirlpool or Wasabi.
- sgp_ 6y ago
  Correct, not as far as I can tell. The methods they describe may be applicable to CoinJoin services (at least the very high-level methods are applicable), but they didn't show any testing with these sort of transactions (unless that's covered by one of the two "Unknown"s, which isn't likely).
ColanR 6y ago
What's the utility of this? Do people track bitcoins as part of their trading schemes? Or is this only something that the IRS & law enforcement would do?
Nokinside 6y ago
I don't people understand the potential consequences of using mixers and anonymized bitcoins. If you have large sums in bitcoins you have anonymized and want to start withdrawing it as USD or some other currency, it can be confiscated unless you can proof it's origin (yes, there is reverse burden of proof). Anonymize only bitcoins you use on the internet as anonymous user. Don't anonymize bitcoins you want to withdraw or convert into legal tender someday.
- RandomBacon 6y ago
  I don't understand people who insist on using a cryptocurrency that they have to jump through hoops to mix and hope they do it properly, spending lots of time and money on fees, rather than just using a cryptocurrency that is private by default.
  - Nokinside 6y ago
    Cryptocurrency that is anonymous by default has the same problem. You can use it only on the net for small purchases. Every time you try take larger sum of cryptocurrency into the financial system, anonymity becomes a legal burden.
    - RandomBacon 6y ago
      > Every time you try take larger sum of cryptocurrency into the financial system, anonymity becomes a legal burden. Not every time. Maybe for some countries or some people. I am a US Citizen and use the US-based exchanges Kraken and Coinbase and have not had a problem with depositing significant amounts of cryptocurrency. (Of course I verified and requested higher limits and reported the capital gains to the IRS).
      - Nokinside 6y ago
        >depositing The problem rarely happens during depositing as the source of money is known. It's the withdraw you must worry about, especially if you have deposited significantly less than what you withdraw. In the US FinCEN is extra strict and US money laundering regulations are tough.

98 points by adulau 6y ago

peteretep 6y ago

Doing anything illegal with transactions on a public ledger strikes me as foolhardy.

uHuge 6y ago
You get the pseudonymity and open/easy access there on the other hand.
- peteretep 6y ago
  > pseudonymity I worry that many people are confused by this, and don’t understand that this will continue to get eroded as time goes on for completed transactions.
  - shadowprofile77 6y ago
    Could you explain a bit more about what you mean by that? My interpretation is that even if you completed a bunch of BTC transactions in a way that allowed you to maintain anonymity, over time, new methodologies or technologies will allow future investigators to trace you as a real person through those old transactions. This? Or something else?
    - hnthrower 6y ago
      That's the just of it. Many of these public ledgers, like Bitcoin, form a massive transaction graph. Blockchain analytics tools and companies de-anonymize nodes in these graphs by matching real-world transactions to blockchain transactions.
      - jlgaddis 6y ago
        > just gist (in case you've ever wondered why gist.github.com is so named)
    - peteretep 6y ago
      Yes that’s what I meant — my interpretation is the same as yours
  - londons_explore 6y ago
    And if you use a mixer or complex wallet setup to try and hide your identity, you are highlighting yourself in the future when more advanced analysis methods start to get used.
ravingraven 6y ago
It is much much smarter compared to any electronic alternative. It is actually the smartest way to do it if done correctly. Only people who do not understand crypto say stuff like that.

xiphias2 6y ago

It's extremely hard not to taint addresses in Bitcoin. As an example if you have a Trezor (which makes using Bitcoin safe and easy) and buy another one as a backup, you can't export your private key from the original one, but you can easily send all Bitcoins to a new address. The only option you have is to get the paper backup (which is guarded somewhere physically separated from your Trezor) and use that to initialize the new device.

wcoenen 6y ago
That's just how wallet backup works, I'm not sure how that is related to taint. Perhaps a better illustration of the taint issue is "change". Whenever you need to send an amount of bitcoin that does not exactly match one of the UTXOs ("unspent transaction output") in your wallet, you will - potentially need to use multiple UTXOs as input (thus linking together the past transaction that produced them) - very likely have a "change" output that sends the excess amount back to a new address in your own wallet. Which output is change can be guessed with heuristics, and that UTXO will eventually be used in a future transaction, linking it to the current transaction. Basically, all transactions associated with a wallet tend to become linkable over time.
- xiphias2 6y ago
  I think you don't have experience with the Trezor. It uses BIP32 wallet (hierarchical deterministic wallet) which derives the private keys from one master seed stored on the device. Older wallets could import separate private keys, but Trezor doesn't have this feature. If you want to move to a new device without having access to the master key, you need to make a transaction that connects all addresses (both inputs and change addresses). It's not just ,,linkable over time'', it means that you link all UTXOs in 1 transaction. What you are wrighting is also a problem, but different from what I had in practice.
  - wmf 6y ago
    If you want to import N UTXOs into a Trezor you can generate N fresh addresses and use N independent transactions to move the money over. Then you have to be careful about joining those UTXOs later. I'm not aware of any wallet that allows this, but it's theoretically possible. I think the advantages of the BIP32 model are worth it considering how many people lost private keys in the old wallet.dat model.

porcine-flight 6y ago

The key assumption which underlies tracking UTXOs is that the people sending UTXOs to each other have some sort of real-world relationship and they are both using the same blockchain. But this is not necessarily true. Two strangers could meet anonymously in an online chat and agree to trade e.g. Bitcoin for Ethereum using a cross-chain atomic swap. In this case the transactions occur on two separate chains, and any available metadata is likely very hard or perhaps impossible for a third party to discover.

nickthemagicman 6y ago
As a noob to this stuff, what if BTC was sent through a Monero chain? Isn't Monero purported to be super anonymous?
- porcine-flight 6y ago
  Monero uses special techniques to obfuscate activity on its chain, increasing the cost of chainanalysis significantly. However, for an attacker that is well funded (e.g. NSA) it's likely a very small challenge to overcome. Besides brute-force tracking of the chain, a clever way to track cryptocurrency users (including Monero users) is to add backdoored cryptocurrency wallets/apps into app stores and capture the data at the point it is created, just as Facebook/Whatsapp capture keystroke input in realtime. This is probably even cheaper than breaking Monero's obfuscation techniques, and also works well against better privacy technologies such as Zcash.
  - DarthGhandi 6y ago
    > However, for an attacker that is well funded (e.g. NSA) it's likely a very small challenge to overcome. Yeah that's a solid "citation needed", you are talking about breaking serious cryptographic assumptions there.
    - vmception 6y ago
      > and also works well against better privacy technologies such as Zcash. It's not even worth responding to this person. I'm not sure there is an educational moment with people like this. For the record, to anyone passing by, I and many others view things in the opposite way. Zcash is less private, it operates in two states with the default state being just like bitcoin, with a separate state having opt-in privacy. Many/most Zcash users think they are using the opt-in state by default which is unfortunate. The Zcash opt-in state is not as anonymous as Monero and is easier to deanonymize and harder to use best practices to thwart. Zcash is developed and run by a US based company which can be much more easily coerced than a distributed team like Monero has doing open source work that collectively funds development when necessary. Zcash organization has budget for advertisement. It is suspicious that Zcash followers present an alternate reality so opposite to this that it is gaslighting, and does exactly what people are worried a centralized VC backed US based company would do.

seibelj 6y ago

Monero is quite anonymous, and https://xmr.to/ https://xmr.to/ allows you to send small amounts of Monero and have them send Bitcoin for you. Just one solution of many to preserve privacy!

vmception 6y ago
and by small, we mean 2 BTC per order, which is $21,600 at time of writing. no limit on distinct orders. Americans just turn on your VPN to access the frontend website, the server and operator don't actually care.
giancarlostoro 6y ago
> Sorry... > XMR.to is currently not available in your region. I guess no Americans allowed
- deleted 6y ago
  [deleted]
- RandomBacon 6y ago
  That's just based off of IP...
  - giancarlostoro 6y ago
    I'm sure it is, but I just wanted to window shop and see what they even had to offer for myself, now I'm just walking away.
heimatau 6y ago
> Monero is quite anonymous Don't trust, verify. [1] [1] - https://monero.org/monero-vs-princeton-researchers/ https://monero.org/monero-vs-princeton-researchers/

nubela 6y ago

If you care about privacy, don't use Bitcoin or any coins for that matter for which privacy is not default. Look at Monero instead.

apples_oranges 6y ago
Or look at cash. :)
- t0astbread 6y ago
  I'm gonna add gift cards paid for with cash to that

HashingtheCode 6y ago

Bitcoin mixers aren't private as the real transaction is in the mix-set somewhere and it is really a matter of time until a determined researcher will find it. Mixers work better the higher number of coin-joins in the mix, and it is better than nothing in that sense, but it gives users a false sense of privacy. Privacy can be had in obfuscating your Bitcoin by sending them using the Lightning Network. You have your own LN Channel and then send them to yourself routing through as many other channels as possible. Bitcoin cleaned. https://bitcoinmagazine.com/articles/how-the-lightning-network-layers-privacy-on-top-of-bitcoin-1482183775 https://bitcoinmagazine.com/articles/how-the-lightning-netwo... Another way is to use ZCoin. Zcoin uses zero knowledge proofs which burns the minted coin and redeems a new coin. SO I convert my 0.5 Bitcoin to Zcoin, the orginal transaction iin Zcoin is burned and new equivalent Zcoin is minted. No trace. Monero is good but it is now under attack by Chainalysis to crack it on behalf of the IRS. https://cointelegraph.com/news/chainalysis-and-texas-firm-win-million-dollar-irs-contract-to-crack-monero https://cointelegraph.com/news/chainalysis-and-texas-firm-wi... When it comes to anonymity from the solutions available; coinjoins, Monero or Zcoin, personally Zcoin seems the most private way to obfuscate one's blockchain trail.

RandomBacon 6y ago
A Zcash user recently made a challenge for anyone to tell where his coins came from that went from taddress->zaddress->zaddress->taddress. The winner only had to look at past public transactions and find the same coin amount to find the original t-address. That is why privacy-by-default is very important, and why right now Monero should be considered more private. Monero has been "under attack" for a long time now, well before the IRS started giving money out. There are possible attack vectors and subsequent remedies. The Monero people made a series called Breaking Monero where they talk about all of that stuff.
- ianmiers 6y ago
  Zcash and Zcoin are two very different things run by very different groups with very different protocols. The poster was talking about Zcoin, and you responded with a canned line about Zcash.

shiado 6y ago

Does anybody know of any papers about attacking coinjoins? From what I understand Wasabi + TOR is still the gold standard of Bitcoin mixing.

RandomBacon 6y ago
Chainanalysis released a publication saying they can trace coins that went through CoinJoin.
- blake8086 6y ago
  Was it https://news.bitcoin.com/chainalysis-whistleblower-shares-company-secrets-in-explosive-ama/ https://news.bitcoin.com/chainalysis-whistleblower-shares-co... ?
  - RandomBacon 6y ago
    No, and I wouldn't necessarily trust an anonymous whistleblower without proof. This is what I was referring to: https://blog.chainalysis.com/reports/introducing-chainalysis-investigation-compliance-support-dash-zcash https://blog.chainalysis.com/reports/introducing-chainalysis... > the exact same techniques that can be used to analyse CoinJoin transactions performed using Bitcoin can be used on Dash.

katsume3 6y ago

Since Bitcoin is not fundamentally private, any attempt to tumble your BTC is fruitless because the Bitcoin blockchain and every transaction is public and transparent. There are even companies like Chainalysis[0] who profit off this fact and help law enforcement with e-crime. I imagine if Satoshi wanted to do Bitcoin again, she would bake in privacy as a core feature? [0] https://www.chainalysis.com/ https://www.chainalysis.com/

jmt_ 6y ago
Possibly not. Satoshi likely did not intend nor desire their currency to be used to facilitate crimes. In fact, they were infamously weary of WikiLeaks using the currency for donations due to the legal issues surrounding them, and WikiLeaks "crimes" are not comparable to say arms trafficking or something substantially illegal. The public nature of the BTC blockchain helps facilitate decentralized, equal participation.
- thaumasiotes 6y ago
  > Satoshi likely did not intend nor desire their currency to be used to facilitate crimes. This is certainly false; the whole point is to invalidate money transmission laws.
  - jmt_ 6y ago
    One can "invalidate" money transmission laws without committing crimes.
    - thaumasiotes 6y ago
      How?
      - jmt_ 6y ago
        Use Bitcoin for legitimate purchases?

intotheabyss 6y ago

If you care about privacy, use Ethereum and zero knowledge proof mixers like tornado.cash.

antonios 6y ago
There's already a privacy-focused coin that isn't a total mess. And no premines. And no mixing hoops to go through. So, why use Ethereum?
- intotheabyss 6y ago
  Because everything is on Ethereum. Once you're in the Ethereum eco-system, there's no reason to leave. Once you're in Ethereum, then you can do whatever you want. Trade on DEXs, do swaps, lend, borrow, leverage, stablecoins, zk mixing, farm liquduity tokens, etc. Once you use Monero, if you ever want to do anything useful with your crypto, you're going to have to inject it into the Ethereum ecosystem, and that inherently means interacting with a CEX. So why not skip that step and just deposit your crypto into tornado.cash and wait for the pool to be sufficiently mixed. That way, you never need to interact with a CEX to actually use dapps on Ethereum.
  - finnomenon 6y ago
    Welcome to zombocom.
    - RandomBacon 6y ago
      https://html5zombo.com https://html5zombo.com
  - ChrisClark 6y ago
    That's true. It would be great to see some more variety in chains being used, but right now everything is being done on ethereum. We need some more bridges to other chains, otherwise there is no reason for anyone to spread out.

clarkmoody 6y ago

This paper is about tracking Bitcoin through centralized mixing services. There is no mention of coordinated CoinJoin services, like Samourai Whirlpool or Wasabi.

sgp_ 6y ago
Correct, not as far as I can tell. The methods they describe may be applicable to CoinJoin services (at least the very high-level methods are applicable), but they didn't show any testing with these sort of transactions (unless that's covered by one of the two "Unknown"s, which isn't likely).

ColanR 6y ago

What's the utility of this? Do people track bitcoins as part of their trading schemes? Or is this only something that the IRS & law enforcement would do?

Nokinside 6y ago

I don't people understand the potential consequences of using mixers and anonymized bitcoins. If you have large sums in bitcoins you have anonymized and want to start withdrawing it as USD or some other currency, it can be confiscated unless you can proof it's origin (yes, there is reverse burden of proof). Anonymize only bitcoins you use on the internet as anonymous user. Don't anonymize bitcoins you want to withdraw or convert into legal tender someday.

RandomBacon 6y ago
I don't understand people who insist on using a cryptocurrency that they have to jump through hoops to mix and hope they do it properly, spending lots of time and money on fees, rather than just using a cryptocurrency that is private by default.
- Nokinside 6y ago
  Cryptocurrency that is anonymous by default has the same problem. You can use it only on the net for small purchases. Every time you try take larger sum of cryptocurrency into the financial system, anonymity becomes a legal burden.
  - RandomBacon 6y ago
    > Every time you try take larger sum of cryptocurrency into the financial system, anonymity becomes a legal burden. Not every time. Maybe for some countries or some people. I am a US Citizen and use the US-based exchanges Kraken and Coinbase and have not had a problem with depositing significant amounts of cryptocurrency. (Of course I verified and requested higher limits and reported the capital gains to the IRS).
    - Nokinside 6y ago
      >depositing The problem rarely happens during depositing as the source of money is known. It's the withdraw you must worry about, especially if you have deposited significantly less than what you withdraw. In the US FinCEN is extra strict and US money laundering regulations are tough.