What Are Coin Mixers and How Do They Work?

Mixers of the coins caught the attention of both cryptomera Community and regulators as a battle for privacy are increasing.

In 2021 was the founder of mixin mixin bitcoin fog arrested on fees, including money washing and the operation of a trade transfer without a license.

A year later the US Treasury issued sanctions against a tornado cash, Ethereum Mixing coin mixing service, efficiently prohibiting Americans to use it.

In the dominant decision in November 2024, the American Fifth District Court ruling that the Ministry of Finance exceeded the sanction Tornado Cash’s smart contractsAlthough its wider designation remained intact.

When reversing your decision by 2022, the Ministry of Finance notified In March 2025 that he had it Discarded tornado cash From the list of parties sanctioned by the Office for Foreign ASSOCIATION OR OFAC.

But what do coins like Tornado Cash and Bitcoin Fog do – and why do people use them? In this article we will explore technology for mixers and their legitimate and illegitimate use.

What is a coin blender and why use them?

A coin blender is a service that allows users to kill the beginning and target of transactions. Users send cryptocurrency to service, let the crypto mix with other coins or tokensAnd then send the equivalent amount of “mixed” coins to the recipient’s address and hide the connection between the sender and the recipient.

There are many legitimate uses for this type of service. Just as you do not want your employer to recognize intimate details of every bank transaction or credit card you have ever done, you may also not want your employer – or anyone else, in this respect – to recognize every detail of each crypto transaction you have ever made.

But as a acceptance of a crypto and blockchain The tools are growing, the real world identities are increasingly associated with blockchain-S addresses by every purchase, transfer or interaction associated with these addresses lined on public, transparent and distributed books. And there are mixers of coins.

This ability to mask the identity of wallets and confused transactions makes the coins an attractive tool for cyber criminals and thus the goal to enforce the right.

While politicians and enforcement of the right of railings against the use of cryptocurrency in criminal companies, coin blends occupy a gray area between facilitating money laundering and maintaining the right to privacy. Due to the free and transparent nature of blockchain, some crypt users rely on the added privacy that the coin blends provide.

Privacy advocates claim that coin mixers are particularly useful, even necessary, in cases where the activity of a person – such as journalism, civil disobedience and protest – can endanger this person. For this reason, they require more privacy in their crypto transactions.

On the other hand, enforcement of law and government agencies perceive coin blends as a way that criminals to wash money using cryptocurrency, and services such as Tornado Cash as a means to cover where the funds originated.

In his notification The Ministry of Finance said from sanctions against Tornado cash that criminals used tornado cash to laundry money and stated that the service had processed a virtual currency worth more than $ 7 billion since its creation in 2019. $ 1.5 billion This character was associated with illicit activity.

Among these illegal funds, the Ministry of Finance was combined with a combined $ 103.8 million stolen from the crypt -free overwhelming services of the Lazarus Group, the State North Korean cyber group sponsored by the state.

The decision from November 2024 from the US Fifth District Court found that the Ministry of Finance exceeded its authority and that the unchanged intelligent Tornado Cash contracts were not property because they are not able to be owned. ” The decision turned and Lower court judgmentHe notes that protocols based on intelligent contracts cannot be classified as services because they work without “human intervention”.

In March 2025, the Ministry of Finance turned the course and removed the cash tornadoes from the list of sanctioned entities. “Based on the review of administration on new legal and political issues raised by the use of financial sanctions against financial and business activities that appear in developing technology and legal environment, we have given our discretion to eliminate economic sanctions against Tornado, as reflected on Monday on Monday.

A month later a federal court ruling That the event of the Ministry of Finance was “illegal” and permanently prevented from renewing sanctions against tornado cash. Judge Robert Pitman from the US District Court for the Western district of Texas issued an order that would force the treasure to “permanently be biased” by sanctions on the coin mixer and bring a significant victory for privacy defense lawyers.

In July 2025, the US Court of Appeal for the eleventh district rejected the appeal Filed Crypto Advocacy Group Coin Center, claiming that the Ministry of Finance exceeded its statutory office in the sanction of cash. The court imposed a joint proposal to release the judgment and fulfill the instructions for rejection, and both parties agreed that the appeal was a “stimulus” after the march of the Council to remove sanctions against the mixer of the coin.

Mixers of coins

• Tornado Cash: This blender was founded in 2019 by Alexsey Pertsev and Roman Storm, and in 2022 he was sanctioned by the US Ministry of Finance in 2022. Tornado Cash exclusively serves the Ethereum network and is unimaginable.
• Samurai wallet: A blender, which is not a curatorial bitcoin, founded in 2015 by Keonne Rodriguez and William deldagan Hill, its founders were arrested and accused of plotting to do money in 2024.
• Wasabi wallet: Founded a pseudo-anonymous zknacks in 2018, uses Zerolink Protocol for creating a privacy of transactions. Wasabi blocked the US residents in using a blender in 2024 after the founders of the Samourai wallet were arrested.
• Bitcoin fog: Bitcoin fog was founded in 2011 by Roman Sterlingov and was in the process of mixing scale. Sterlingov was convicted of money washing in 2024.

How do coin mixers work?

Before Tornado was taken away, she used smart contracts Accept the token deposits from one address and allow them to download them from another address.

Other coin blends work in a similar way, with intelligent contracts that act as a swimming pool where all stored tokens mix together. When the funds are withdrawn from these funds, the connection between the source and the goal is disrupted, anonymizing the transaction.

These types of coin mixers are usually unpredictable, which means there is no control of the wallet and third -party funds, simply by creating intelligent contracts.

Because these services do not use any intermediary, they are reliably neutral – but it also means that they can be an attractive tool for cybernetic criminals looking for washing the stolen crypt, as in the case of the Lazarus Group.

Mixers of the coin: Timeline

• October 2011: Bitcoin bitcoin fog is running.
• December 2019: The cash mixer is launched.
• April 2021: The US Ministry of Justice announces Arrest of Bitcoin operator Roman Sterlingov.
• August 2022: US Treasury sanctions Ethereum Mixer Tornado Cash. A few days later, Alexey Pertsev developer in Amsterdam is arrested for money laundering fees.
• March 2024: Bitcoin fog operator Roman Sterlingov is convicted Washing money.
• April 2024: US authorities arrest and fee The founders of the Bitcoin Mixer Mixer Samourai who blame them for a conspiracy for committing money.
• May 2024: Wasabi Wallet announces preventive closure Its mixing, prohibits US customers to use their services. At the same time, Phoenix Wallet pulls its application from the US stores, while the hardware wallet The safe announces the interruption of its Coinjoin function.
• November 2024: American Fifth District Court rules They should not be classified as “property” that unchanging intelligent Tornado Cash contracts.
• March 2025: Cash register raises his sanctions Against Tornado Cash.
• April 2025: Judge of the US Federal Court he issues an order Permanent blocking of the Ministry of Finance in the renewal of sanctions against tornado cash.
• July 2025: The US Court of Appeal grants a Common movement End the attraction of Crypto Advocacy Group Coin Center against the Sanctions of ACCAC.

Legitimate cases of use of mixers of coins

Let’s say there is a company owner and a crypto enthusiast named Robert, who wants to send Ethereum to a hacktivist group working from Ukraine. Robert does not want his gift to be traced back, so he uses a coin blender.

Robert goes to the web mixer of coins and inserts Ethereum, which he wants to donate. The amount sent is stored in the intelligent mixer contract and associated with other hundreds, thousands or even millions of transactions already in their fund. After receiving the confirmation that the deposit was successful, Robert goes to the download card, enters the recipient’s address to the blender and sends the Ethereum from the blender.

Ethereum is then sent from mixing the recipient. At the end of the receipt, the address of the mixer address and not the original sender addresses, an anonymizing transaction.

If this hypothetical scenario sounds familiar, it is based on the tweet by the co -founder of Ethereum Vitalik Buterin, published after the Ministry of Finance approved Tornado cash.

The future of the coin blends

The debate on the protection of personal data of the crypt is still raging, despite a number of legal cases and sanctions against coin mixers.

November 2024 decision that unchanging intelligent contracts cannot be classified as “assets” Wagon It advocates crypto and privacy as an orientation moment, which means that the independent code, which works without any administrative control, cannot be the subject of sanctions.

The aim of newer projects, such as Railgun, to provide users’ privacy on the chain, but also to ensure that they remain in the eyes of the law.

Railgun is not a traditional blender; He does not mix coins from several sources together, and its founders believe that he is avoiding the pitfalls that eventually led to the mixers to be sanctioned or sued.

It also uses “private evidence of innocence” to ensure that bad actors cannot use this platform for illegal purposes. For example, July 11, 2024, a notorious crypto drain known as Inferno drainer tried to use Railgun to wash 174 eth. Railgun, however, found that the wallet was tied to a bad actor and blocked the transaction.

Whether an effort to protect privacy crypto privacy is to create legally compatible with mixing services will be mollified by legislators, is open to debate. But one thing is certain – the privacy advocates will continue to fight to ensure that the crypto is not Panopticon.

As Lia Holland, director of campaign and communication in Fight for the Future, he wrote In 2022: “Provide clear, hackers and cybernetic criminals, as well as those who support them, are deplorable and should be stopped – but not in a way that threatens human rights and the first amendment.”

This article was first written in August 2022 and updated in July 2025.