Bitmixer.io, the largest mixing service for Bitcoin, has shut down, recommending its users use Dash or Zerocoin instead.
Mixing services, sometimes known as coinjoin or tumblers, take a user’s balance, mix the inputs with those of coins with those of other users, and send the now-mixed balance to its final destination. The result is that the transaction will appear to have come from several different origins, obscuring which user or set of addresses originated the transaction, thus preserving privacy and anonymity.
Bitmixer was the largest of these services for Bitcoin. After announcing the shutdown in a Bitcointalk thread, the owner suggested users switch to an innately more private coin such as Dash:
“You may use Dash or Zerocoin if you want to buy some weed. Not Bitcoin.
“I hope our decision will help to make Bitcoin ecosystem more clean and transparent. I hope our competitors will hear our message and will close their services too.”
Privacy is in high demand, but not universally believed to be a right
The ability to conduct private financial transactions is highly valued by the market. For example, just the three top cryptocurrencies originally centered around privacy alone are currently valued at $2.4 billion combined. Bitmixer claims to have run a very successful and profitable service, and that the decision to shutter its doors was based on a philosophical change of heart.
“Despite the huge profit we earn, we are closing our activity. Let me explain why.
I’m bitcoin enthusiast since 2011. When we started this service I was convinced that any Bitcoin user has a natural right to privacy. I was totally wrong. Now I grasped that Bitcoin is transparent non-anonymous system by design. Blockchain is a great open book. I believe that Bitcoin will have a great future without dark market transactions.”
Meanwhile, Dash, while having expanded to cover many more features and a more expansive vision than pure anonymity, nonetheless remains focused on providing financial privacy, as reiterated by Dash Core CEO Ryan Taylor earlier this summer:
“Privacy is absolutely critical when it comes to financial transactions and balances. Dash was founded on this belief and it was the first digital currency to deliver a high degree of privacy in the market. As Dash has grown and matured as a service, we’re doing so much more than simply privacy, but that doesn’t come at the expense of our commitment to privacy.”
Dash is the only top-five coin with built-in privacy features
Of the five highest-ranked cryptocurrencies in the markets, Dash is the only one to offer built in, explicit privacy features. Bitcoin has long leveraged third-party mixing services in order to anonymize funds, and in context of Bitmixer shutting down we can see how this reliance may be a liability.
Ethereum also includes no built-in privacy services, which has led to the rise of similar mixing services to those seen in Bitcoin. This demand for private, mixed transactions was solved three years ago by Dash, without having to rely on a third-party service.