Bitcoin (BTC) and cryptocurrency mixers continue to offer solutions and services to users. According to the blockchain analysis firm Chainalysis, Bitcoin mixers have registered an all-time high usage as people try to protect their privacy. The report released a few days ago explains that cybercriminals contribute a significant volume to these mixing services.
Chainalysis Reports a New Record of Mixing Services Usage
As per the report, despite the benefits offered to people living under oppressive regimes and governments that require better privacy solutions, mixing services are a go-tool for cybercriminals that want to obfuscate the source of their funds.
The report shows that close to 10% of all funds sent from illicit addresses are sent to mixers. This is something that Chainalysis is trying to fight and change. The company claims that these mixers could become obsolete in the future as Chainlysis continues to refine the ability to demix certain mixing transactions. Despite that, they also say that data shows that mixers are receiving more cryptocurrency than ever in 2022.
The company wrote about the increase in volumes for mixing services:
“Mixers may soon become obsolete as Chainalysis continues to refine the ability to demix certain mixing transactions and see users’ original source of funds. But for the time being, our data shows that mixers are receiving more cryptocurrency than ever in 2022.”
Most of the funds sent to mixing services came from centralized exchanges and decentralized finance (DeFi) platforms. Almost no transactions were registered from high-risk jurisdictions, showing that using mixing services to launder money might not be the case. It is also worth mentioning that there are also almost no transactions coming from high-risk exchanges.
But how do mixers work?
Mixers work by making it difficult for blockchain analysts to track the source of funds of some addresses. As explained by Chainalysis, mixers create a disconnect between the crypto funds that users deposit and what they withdraw.
There are many different ways in which these mixers obfuscate transactions. For example, a person can deposit funds and will receive the same amount of BTC at different addresses. But to make things more difficult, these mixing services can also change the address type, the time at which the transaction is processed, and more.
There are different types of mixing services online that users can rely on in order to process transactions. These mixing services have different degrees of usability and features. In some cases, mixers can be more private and advanced than others.
Chainalysis explains that it might be difficult for mixers to implement KYC procedures and controls as mixers are focused on offering privacy solutions. Therefore, the company knows that it seems unlikely that these compliance procedures could be implemented.
It is very important for the cryptocurrency market to have more privacy features and options in the coming years. Failing to do so could result in users being affected by data leaks, government oppression, and many other things that would only damage users’ privacy and freedom.