Crypto Mixers, Tumblers Explained And Tornado Cash Alternatives

Crypto mixers or crypto tumbler services, along with Tornado cash and alternatives have been in the news recently.  Cryptocurrency mixers are also known as crypto blender services.

Here we explain what a crypto mixer is, and its uses. We have information on what is Tornado Cash and why it got into trouble with US Government regulators.

We list some Tornado Cash alternatives, including a list of crypto mixing services.

Before using a crypto mixer, you should know which blending services have been sanctioned by Government regulatory agencies, around the World and particularly in the US. We have listed a few of the main sanctioned crypto mixers below.

Why Are Crypto Tumbler Services Needed

When cryptocurrencies like Bitcoin (BTC) are sent or transferred using the Bitcoin blockchain network, the transactions are verified by bitcoin nodes.

A bitcoin node is a computer or server connected into the Bitcoin’s peer-to-peer network. These nodes host and synchronise a copy of the entire Bitcoin blockchain. They are essential for keeping the cryptocurrency network running.

Now, the Bitcoin blockchain like many other cryptocurrencies is entirely public. When people send Bitcoin or other cryptocurrencies, they generally use one of these top Crypto exchanges, like Coinbase, Gemini, Binance and Kraken etc.

Using a blockchain explorer website, anyone can see an exact record of all the bitcoin transactions ever processed since the cryptocurrency’s launched in early 2009.

You can click into each bitcoin transaction, and view the details of each transaction, along with the history of the public address used to send and receive the bitcoin. You can even see information including total sent and total received for that address.

For many the public nature of Bitcoin, and similar cryptocurrencies and blockchains, this is a huge privacy flaw.

Crypto mixers and tumbler services help secure the transaction data from being known to the World.

Crypto Mixers For Privacy

Most cryptocurrencies are developed in a logical nature. For example, anybody with the proper expertise can download the Bitcoin blockchain to analyze exchanges, wallet locations, names, ledgers, and identification cards.

What Are Crypto Tumblers – Answered

best crypto tumbler service

In basic terms, a crypto mixer service accepts cryptocurrency from multiple users’ wallets, mixes them so you can’t identify who sent how much, and then sends out different cryptocurrencies to their destinations.

If you were to view such a transaction on a blockchain explorer, you would find the address of the mixer as the recipient for an outgoing transaction from your wallet, instead of the cryptocurrency address.

Also, if you typed in a transaction recipient’s address, to see where the coins came from, all you would see is the tumbler’s address.

It’s called a “mixer or tumbler” because it mixes and tumbles around your coins with other holders’ coins to the point where none of them can be connected back to their original wallet addresses.

Hence, when you use this solution, you can send or receive cryptocurrencies while remaining completely anonymous.

There is generally a small fee involved in the transaction.

How Crypto Mixers Work Video

This first video gives a nice simple explanation of what is a cryptocurrency blender software service.

Crypto Development Mixer Projects On GitHub

If you are looking to learn all about blockchain technology, then understanding crypto mixing is another area to understand.

There are a number of Cryptocurrency mixer projects on GitHub.  These crypto blender projects can include information on the hardware required, the backend application, website frontend and security.

Some of the programming languages used in the Cryptomixer projects on GitHub are PHP, CSS, C++, C Sharp, JavaScript, Perl, HTML.

A great way to learn is to start off by building a test project or lab. Also, join forums and ask questions and build your knowledge.

Here are a few of the crypto mixing projects presently on GitHub.

If you want to earn nice interest on your cryptocurrencies, read this article entitled “How To Earn Big Interest On Crypto Stablecoins“.

Crypto Mixers Charged, Fined, Sanctioned

Recently, cryptocurrency mixing software, their CEO’s and employees, have been found guilty of illegal activities by Governments.

They have been sanctioned, charged, fined, and sent to prison. Here are a few crypto mixers who have been in the news in the past few years;

What Is Tornado Cash – Answered

Aritcle From CoinGecko

Tornado Cash is a decentralized non-custodial privacy solution, built on the Ethereum blockchain-based zero-knowledge proofs.

It enables users to break links in on-chain transactions, and enhance transaction privacy between deposit and withdrawal addresses.

What Is A Zero Knowledge Proof

A zero-knowledge proof allows you to prove the truth of a statement without sharing the statement’s contents or revealing how you discovered the truth.

To make this possible, zero-knowledge protocols rely on algorithms, which take some data as input, and return ‘true’ or ‘false’ as output.

Another way to describe Tornado Cash is that it leverages smart contracts to facilitate ETH deposits and multiple address withdrawals.

These withdrawals are made from the Tornado protocol liquidity pools, making it difficult to know the sender’s identity.

As part of the service, Tornado creates a secret hash when a user deposits crypto. Its protocol admits the deposits, and the hash in a process known as commitment. This commitment identifies the owner of the funds and confirms them during withdrawal.

When withdrawing the funds, the user must input the secret hash to prove ownership while maintaining on-chain anonymity.

In May 2020, the Tornado developers surrendered the management of the protocol’s multi-signature wallet, via a contract update referred to as Trusted Setup Ceremony.

Therefore, the founders lost control of Tornado, making it a completely decentralized protocol.

TORN is the native currency of Tornado Cash. It’s an ERC-20 token with a maximum supply of 10 billion coins, and it enables holders to participate in proposals and vote for protocol changes.

Example Of How Tornado Works

When you mix crypto assets using the Tornado Protocol, you break your blockchain transaction link, and enjoy privacy on a public network like Ethereum. For that reason, you can deposit funds into the protocol, and withdraw them into a web3 wallet.

For example, suppose a person wants to conceal 100 ETH on-chain activities. In that case, the person can send tokens to the Tornado Protocol to mix them up in liquidity pools, and withdraw them to a separate address or address.

This way, the protocol helps the person to remain anonymous on-chain.

Now, if the person uses the protocol without putting upstream and downstream measures in place, he will enjoy only partial anonymity.

As such, it is recommended using a VPN to stop 3rd parties from establishing that Tornado Cash is being used.

Also, deleting browsing history, and practicing patience since withdrawing the assets immediately after mixing makes it easier for trackers to correlate deposit, and withdrawal addresses, and using many addresses.

US Sanction on Tornado Cash

On August 7, 2022, the US Treasury sanctioned Tornado Cash for allegations of helping North Korean hackers launder billions of dollars of crypto.

The Office of Foreign Asset Control (OFAC), a regulatory agency under the US Treasury responsible for imposing sanctions, confirmed the news, prohibiting US crypto users and businesses from interacting with the protocol.

According to the Treasury, Tornado Cash has laundered over $7 billion worth of crypto since it was launched in 2019.

The laundered assets include $445 million hacked by the Lazarus Group, a famous North Korean-based hacking entity already serving US sanctions.

Previously, the group was linked to the $625 million Ronin Network hack and the $100 million Horizon Bridge hack

Furthermore, the Treasury said hackers used Tornado Cash to launder almost $7.8 million in stolen assets in the recent Nomad heist. This is where attackers exploited a severe bug to steal $100 million in cryptocurrencies, including ETH, BNB, USDT, USDC, and DAI.

As such, the Treasury blamed Tornado Cash for failing to implement adequate measures to stop hackers from using it for money laundering activities.

They further warned that they relentlessly sanction coin mixers that assist criminals in laundering money.

Effect of the Ban

Tornado Cash started to feel the heat immediately after the ban. The Treasury blacklisted 38 Ethereum wallets and six USDC wallets belonging to Tornado Cash.

Besides, Circle (the USDC custodian), and GitHub complied with the sanctions.

In other news, GitHub responded to the ban by blocking accounts of Tornado developers, like Roman Semenov and Alexey Pertsev.

Other GitHub accounts linked to Tornado Protocol were also deactivated, but it’s not clear whether they were deactivated voluntarily by the handlers or forcefully by GitHub.

Tornado Cash Crypto & Privacy

Although Tornado Cash may have been used by criminals to launder money, it’s also widely used legally by crypto users who simply want to improve their blockchain privacy.

The protocol’s proponents strongly argue that Tornado is a computer code that can be used for good or bad intentions – similar to internet VPNs.

Latest Tornado Cash News

Fortune Article: Coinbase employees and Ethereum backers sue U.S. Treasury over Tornado Cash sanctions

Six users of Tornado Cash, a popular decentralized cryptocurrency service, filed a lawsuit on Thursday against the U.S. Treasury Department, Treasury Secretary Janet Yellen, and other officials over their decision to sanction the service in August 2022.

The outcome of the case, which turns on the novel legal question of whether the U.S. government can impose sanctions on publicly available software code, is likely to have implications for the crypto industry for years to come.

In a 20-page complaint filed in federal court in Texas, the users claim the decision to sanction Tornado Cash exceeded the government’s authority; violated their free speech and property rights under the U.S. Constitution; and “threatens the ability of law-abiding Americans to engage freely and privately in financial transactions.”

Tornado Cash Information

Here is some other information on Tornado Cash along with social media links.

Token Price

Social Media

Tornado Cash Alternatives or Similar 

Here are some of the best Tornado Cash alternatives available.  They are not exactly the same, so you need research the service before using.

Also, there is a lot of total scams out there.  One of the top searches in Google for Tornado Cash Alternatives, brings up a search result of “Top 10 Cyrpto Mix Platforms Other Than Tornado Cash To Use in 2022”.  Practically every mixer in that article has either been fined, sanctioned or are a straight out scam.

So, be very careful when you choose a crypto mixer / blender service.

CoinJoin Protocol

The CoinJoin protocol enables a trustless bundling of Bitcoin transactions. The goal of this technique is to provide an extra layer of privacy to users. CoinJoin utilizes a coin shuffling protocol.

The system is built to combine transactions and create a multi-party Bitcoin transaction. The protocol will mix multiple input signatures, and outputs before a transaction takes place to accomplish this task.

This approach makes a new combined UTXO (unspent transaction outputs) and Bitcoin transactions.

Or very simply, A CoinJoin is when two or more people combine their transactions into one transaction, in such a way that it is unclear who owns which coin after the transaction. The ambiguity is created by matching the size of the inputs or the outputs.

Here are 3 excellent articles on CoinJoin.

Comprehensive Bitcoin Coinjoin Guide

How Does CoinJoin Work

Cracking the CoinJoin Wallet

Note: Do not use the website called coinjoin.io as it is not CoinJoin. It is not a proper service, and the website contains no information. This is not a coin join service or Tornado Cash alternative. You could very much lose your cryptocurrency on that website.

There are plenty of excellent services available where you submit your coins to a pool for mixing including Wasabi and JoinMarket.

Some of the services such as Wasabi use a technique called peelchain. This technique takes, large transactions pushed through are progressively “peeled” across successive transactions.

Basically, it occurs when one large sum of cryptocurrency is sent to multiple addresses in a series of transactions in which the sum is peeled.

So, a small amount is taken off or, peeled off, the chain to be sent to a new address. Then, this process is repeated many times. At some point, the funds will reach the destination,

ZeroLink Protocol

ZeroLink requires “zero linking” of mixed and unmixed Bitcoin. The project is a collaboration between the teams behind Samuraiwallet and Hiddenwallet to specifically target Bitcoin anonymity and privacy measures.

The ZeroLink protocol use a technique known as Chaumian CoinJoin, which has been a commonly used solution in the cryptocurrency world for quite some time now.

However, this Chaumian implementation is slightly different, as it utilizes what are known as Chaum Blind Signatures.

Users provide inputs and change addresses to the protocol and use a blinded version of the address they want coins to go to. The server used for this purpose then signs the tokens and returns them.

What Is ZeroLink

ZeroLink Protocol On GitHub

Whirlpool is Samourai’s implementation of ZeroLink coin-mixing protocol.

JoinMarket OrderBook

Another alternative to Tornado Cash is JoinMarket. This uses an orderbook that makers advertise on, allowing takers to pick from the available maker offers.

Makers will connect to the JoinMarket Orderbook with a unique ID.  Next, they will post an offer to the orderbook containing the following information:

  • the fee the maker is charging for mixing with takers
  • the amount the maker will contribute to miner fees
  • then the minimum and maximum denomination value they will make mix-denominated outputs in.

They also post a way for people to privately connect to them directly.

When takers want to CoinJoin, they download the orderbook and their client selects makers to mix with based on their settings.

After the client selects a maker, the taker will post a temporary public key for encryption and start communicating with the maker through encrypted messages over IRC.  It is worth noting that it is possible for multiple takers to be connected to a single maker at the same time.

If all parties agree, they sign the transaction, including the taker’s fee to the maker, and submit it to the network.

Because of how this coordination works, makers do learn the outputs of takers in the process of coordinating the CoinJoin construction.

To mitigate this, JoinMarket has a “tumble” feature, where the taker’s client will mix multiple times with different makers until reaching the number of mixes set.

This guarantees that no single maker will be able to unwind a single taker’s entire mix history, because each maker along the “tumble route” only learns the connections in that one transaction.

You can read further on how to download the JoinMarket order book here.

Another excellent article is JoinMarket vs ZeroLink.

Bitcoin Lightning Network

The Lightning Network has the following benefits.

  • Bitcoin transactions on lightning are instant, almost free, and are final settlement
  • Transactions are not recorded on-chain
  • Transactions can be completely private and peer-to-peer

So, a truly anonymous bitcoin transaction could take place between 2 participants, and the only record that this transaction occurred would be in the hands of only you and that person.

Many users, use Lightning service providers, such as Breez and Phoenix.