Crypto Feb 05, 2020

Increasing Anonymity in Crypto Transactions

Achieving crypto anonymity using tumblers and privacy coins

At this point in the twenty-first century, most of the governing sectors seem to be inclining towards a more efficient and seamless future.

This explains why the adoption of fast and frictionless transaction systems such as the blockchain are now receiving a tremendous level of acclaim from both fans and critics alike in what appears to be a ubiquitous liberal awakening in embracing improvement, advancements, and convenience.

Nevertheless, there still exists a looming considerable degree of risk and uncertainty that presents itself in the subject matter of bitcoin. To put this into context, in 2018, an estimate of an upwards of $1.5 billion worth in cryptocurrencies was, in one way or another, stolen.

This deeply concerning statistic would mean that about 75% of active bitcoin users expose themselves to the risky act of high-wire walking every time they transact using the crypto for fear of embezzlement is very much present.

With this in mind, an even greater deal of concern given that these digital currencies and their expansive list of benefits have gone so far as to capture the interest of governments and other private entities. This has, in turn, led to an increase in crypto adoption across the globe.

The need to streamline tax services and disclose any discrepancies in public tax payments has prompted most governments to develop policies to intensely scrutinize the efficient new and rivetting frontier of decentralized digital payments.

This move has not been received well by the crypto community as it has been deemed to be intrusive and a dire breach of the right to online privacy. A notable reason is that most of these inspective procedures are done without the express consent of the crypto accounts owners.

Fortunately for the cryptocurrency community, there are some innovations designed to curb the possibility of an insecure crypto market, free from government inspection and other online marauders.

One of the most outspoken are cryptocurrency tumblers. They are an efficient way to ensure that any cryptocurrency transaction remains deeply personal only to the transactor.

Cryptocurrency Mixing

This is one sure way to ascertain a confident level of cryptocurrency anonymity. It is also surprisingly quite simple to understand, and various online platforms offer this service. All one has to do is register an account with them.

This system works by shuffling one’s coins with a larger repository of other coins to receive an entirely new set of coins that are entirely different from the previous ones.

To use tumblers, a small fee is needed to facilitate this service, often an amount that rarely exceeds three percent of the original value of the coins. You can think of it some way like a ball pit, where you throw in your balls, they get jumbled around in the vast probability space inside the pit, and after some time you get the same number but a different set of balls.
Though this process might appear quite see-through and flaccid, it has a whopping proven record of success, and there have been many positive remarks attached to this innovation. Although the service is open to all cryptocurrencies, the most rampant use of these tumbling services is observed form bitcoin users.

Most of the users of these facilities are often high profile investors who trade in large sums of cryptocurrencies. For this reason, there is a pressing need for high stake security, given the impending gravity of the loss if any fraudster breaches their wallets.

Dark web markets and their customers are also avid users of the mixing services, given that there is a great deal of secrecy and security that is warranted. This is attributed to the illegal nature of their operations.  

Regardless of your motives, one thing we can agree on is that tumbling is one sure secure way to protect your crypto transactions from being tracked by third parties. Some even go as far as to say that mixers is to cryptocurrencies what the virtual private networks (VPN) are to online privacy.

Privacy Coins

A genius innovation as it might be, some crypto developers appear to have already thought ahead on how to improve anonymity on their digital currencies.

In what is deemed to be private-eccentric, some cryptocurrencies come with inbuilt ring signatures and stealth addresses, which make it a dauntingly difficult task to trace.

Monero, ZCash, and Dash are just but a few examples of privacy coins that have been integrated into some dark web markets. Below are a few honorable mentions as to how tumbling facilitates anonymity.

Concealed Sender Exposure
For a typical cryptocurrency transaction cycle to be deemed complete, the sender’s wallet address has to be sent to the recipient. This is a major loophole that exposes the source of the transaction, particularly the sender’s details.

On the flip side, tumbling one’s coins puts the sender at a position of advantage. The reason is that the relevant recipient will receive the money, and there will be no way to uncover the source of funds.  Transactions that go through a tumbler have no connection to the sender.

Bypassing Restrictive Federal Policies
It is undoubtedly factual to claim that cryptocurrencies have been a disruptive enigmatic force since their onset. Myriads have grown chunky digital wallets and bank accounts off them, and many would still wish to maintain a healthy habit of cryptocurrency trading.

With respect to the capitalistic policies embraced by most governments, some nations are proposing ways to tax crypto.

This manner of authoritative intrusion can be quelled by tumbling. China is one classic example that could greatly benefit from this. Despite it having one of the largest number of cryptocurrency miners, the nationals are limited to engaging in crypto activities.

Smartmixer Tumbling Service

Smartmixer is one of the most prolific tumbling/mixing services that are available for use in the market. Besides the standard/atypical functioning of a tumbling service, what stands out with Smartmixer is its user anonymity features.

The site does not save the transaction log for longer than it should. One can also choose to delete them the minute his/her coins are tumbled, and the site would respond to this in a timeframe not exceeding twenty-four hours.

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