While Bitcoin has been lauded as a pseudonymous cryptocurrency, the open blockchain on which most cryptocurrencies operate means that anyone can view all transactions, coin and wallet addresses associated with a particular Bitcoin address. This isn’t an issue for normal transactions, but it can pose problems for people wishing to use the currency for money laundering or other illegal activities as their transaction history can easily be linked back to them. Bitcoin tumblers, which are sometimes called mixers, aim to solve this problem by ensuring that your cryptocurrency transactions remain anonymous.
What is a Bitcoin Tumbler and Is It Safe?
A tumbler is a piece of software that takes the Bitcoin from multiple users and mixes them together so it is impossible to trace which coin belongs to which user. It then sends the coins to their intended destination. Tumblers can be centralized or non-custodial. Most centralized tumblers require a signup and login in order to deposit funds. Non-custodial tumblers, which are built into certain wallets like Samourai Wallet’s Whirlpool feature and Wasabi Wallet, mix funds automatically using protocols such as CoinJoin.
The most important benefit of using a Bitcoin tumbler is that it protects your transaction history against blockchain analysis. Tumblers also offer flexibility by allowing you to choose an output you control to ensure the desired change is sent and can offer lower transaction fees by reducing the number of coins that need to be transferred. Finally, tumblers can help obfuscate your transaction by adding delays between the input and output of your coin. This makes it harder for regulators to identify tainted funds. Bitcoin Tumbler