Crypto tumbler is a service that helps people improve the anonymity of their cryptocurrency transactions. Essentially, it mixes your coins with others to make it harder for law enforcement to track them back to you.
There are a few different types of Bitcoin tumblers. Some are centralized and custodial, where you send your coins to the tumbler and it mixes them with other users’ coins. Then it returns your coins to you, minus the transaction fee.
Other tumblers are decentralized and non-custodial, where you create a mixing pool with other users and then mix your own coins with them. Tumblers often use a method called CoinJoin, which is an open-source protocol that helps to obfuscate the link between your sending and receiving addresses.
Because of this, tumblers are sometimes used to hide illegal activities like money laundering. While Gizmodo Australia isn’t suggesting that you use a tumbler to hide any illegal activity, it’s worth looking at your legal obligations before using one.
Tumblers can also be useful for obscuring your IP address and online activity, which is helpful when you’re using a public cryptocurrency wallet or exchange. If you’re concerned about privacy, it may be best to use a tumbler in combination with a Tor network and/or a VPN. However, there’s always the risk that a tumbler could be hacked or shut down. Just recently, a popular tumbler called Bestmixer closed down after warning its users of this risk. Crypto tumbler