An increasing number of people are using cryptocurrencies to complete transactions, make donations, store wealth, speculate, or just transfer value, among a host of other uses. With the understanding that cryptocurrency transactions can be tracked, and are not anonymous as earlier alleged, just as many people now exercise caution when transacting. But, which methods are effective in maintaining anonymity and improving privacy?
Aside from keeping your IP safe from clogging, using new addresses each time you transfer cryptocurrency, and being keen when transacting in the public domain, cryptocurrency mixing has also been touted as an effective safety tool. However, is it as important as cryptocurrency enthusiasts would want you to believe?
Cryptocurrency Mixing Defined
Cryptocurrency mixing involves using a tumbler or mixer to obscure your cryptocurrency transactions. The tumbler, in most instances, has a pool of cryptocurrencies (the most common technique) to which yours is added before the mixture is sent to a new, discreet address.
The Reasons Why a Cryptocurrency Mixer is Essential
Sanitizing e-Commerce and Allied Online Transactions
As mentioned above, purchases of both goods and services can now be completed online using cryptocurrencies. However, a cryptocurrency transaction reveals a lot more than is necessary.
The public ledgers on which the transactions are recorded can be accessed by anyone. Meaning, your vendor can, just by using your Bitcoin address, determine the balance contained in your account and even track previous deals and future transactions.
Using a cryptocurrency mixer, however, limits the amount of information that the public may be privy to.
Governments’ Interest in Cryptocurrency Wealth and Transactions
For the purposes of broadening the taxation brackets, many relevant governmental agencies now track Bitcoin wealth and transactions. While it is prudent to disclose such wealth and dealings to the said agencies, it is not wise to put your transactions in the open for anyone to poke at will.
If anything, paying taxes on profitable transactions makes sense. However, remitting taxes only because the government says so, and even on business processes that the same governments do not properly understand, or, on whose operations they the authorities have not drawn conclusive regulations is dumb.
In cases where you feel the government is overreaching, and unjustifiably so, you, may use a cryptocurrency mixer to conceal what needs to be obscure.
Holding Cryptocurrency Wealth
The administration of a few countries in the Orient have continued to restrict the ownership of cryptocurrencies. In doing so, they have denied their citizens a chance to hold crypto, and or speculate based on the immense potential of the blockchain. China, in particular, is strict, and does not allow its citizens to deal in (mostly ICO and crowdfunding activities related to blockchain projects) or entertain cryptocurrency riches, in certain instances.
Using a mixer, citizens of such countries can buy crypto discreetly, and keep it safely, away from the prying eyes of the government and its overbearing regulatory agencies.
Safety in Day-to-Day Business Transactions
Cryptocurrency dealings have seen a new crop of billionaires emerge. The single-most frustrating challenge that this nouveau riche class of the society faces is how to go about their businesses amidst all the privacy breaches.
Luckily, a cryptocurrency mixer can effectively help anyone to conceal his or her transactions.
Some people are just naturally concerned about their privacy. The fact that whatever they are doing can become common knowledge via just a few clicks does not sit well with them. Such people should find comfort in the capabilities of cryptocurrency mixers. Used appropriately, it forever conceals whatever dealings you engage in.
Consequences of Disregarding the Need for a Cryptocurrency Mixer
According to a US cyber-security company CipherTrace, the amount of cryptocurrency scammed from exchanges and investors in 2018 alone surged some 400% to hit $1.7 billion. Of this amount, almost $1 billion was stolen from the cryptocurrency infrastructures such as wallets.
As stated above, the innovations in the blockchain and cryptocurrency space have given birth to many new-age billionaires. Most of these keep their wealth in the form of cryptocurrency. Because it is easy to know the extent of such wealth in situations, scammers may take advantage and swindle such individuals of their fortune.
Further, it may get a little more dangerous than just scamming. Where schemes to swindle victims do not go according to plan. Scammers may resort to kidnap, which may lead to loss of lives.
While governments are justified in their tax collection endeavours, some of their actions are akin to overdone gyps. Where necessary, and within the confines of established policies and regulations, cryptocurrency mixers can ensure that the government knows only what it should know about your cryptocurrency dealings
Privacy is an important currency when transacting online. The fact that cryptocurrency deals throw this out the window, yet cryptocurrency offers unrivalled convenience is a technological conundrum that crypto enthusiasts had to deal with, and fast. Thankfully, cryptocurrency mixers, their solution to the problem, is very effective.