Crypto tumbler, also known as Bitcoin mixer, is a service that helps enhance the privacy of users’ cryptocurrency transactions by obfuscating the direct connection between the sender’s and recipient’s digital wallets. While the blockchain system on which cryptocurrencies are based is meant to be decentralized and secure, it can be traced by outside observers if there’s a clear link between wallets that’s hard to avoid.
The way tumbler services work is similar to that of money blenders: users deposit their coins in the tumbler’s pool, then get back the same amount they put in, minus transaction fees. But this time the return is made up of fractions of the same coin sent by other members, making it difficult to identify the original wallet that sent the coins.
There are different types of tumblers, with some relying on peer-to-peer networks and others operating as centralized services. Users should carefully consider which tumbler to use based on their specific needs, and take additional steps for increased anonymity, such as using encrypted wallets and following security best practices.
Tumbling your cryptocurrency isn’t illegal, but it is considered risky if done for malicious purposes, such as money laundering or tax evasion. It’s also worth checking whether tumblers comply with your country’s laws regarding anti-money laundering and counter-terrorist financing, to ensure they’re doing what they claim to do. If not, you might be breaking the law. This article was originally published on Oct 25, 2018 and has been updated. Crypto tumbler