Posted by: Cipher </span> May 25, 2014
As we wait for emerging cryptocurrencies such as Darkcoin and the standardisation of Dark Wallet the current task of coin-mixing remains an immediate issue. As it stands Bitcoin Fog remains the gold standard of coin-mixing. However, it is important that people be made away that this is a slow process. Bitcoin Fog insist on six confirmations for deposits and will set a minimum delay of six hours for withdrawals to occur to held randomise/anonymise the process. This is a sound process for those approaching their transactions in a structured and planned manner. It is not ideal for anyone trying to get money quickly from one account to another.
On this basis we can say Bitcoin Fog remains the gold standard in long-term scheduled coin-mixing. Presumably this appeals most to vendors who are washing large amounts of Bitcoins (numbers most of us will likely never see!). It might also appeal to those content to sacrifice speed for privacy as a rule. Fees remain at 1%-3% in random order and this could be a hefty cut the larger the transaction. Nonetheless the service remains broadly unchallenged in terms of obfuscation. Bitcoin Fog is, further, only accessible through Tor though a clearnet gateway is sometimes running (https://gate.bitcoinfog.com/)
The second service to be analysed is the ‘Shared Coin’ feature of Blockchain.info. A descendent of their original ‘Shared Send’ feature (currently discontinued) this method suits those undertaking transactions with an eye toward the medium-term. In the old ‘Send’ service one essentially had a mirror of Bitcoin Fog’s process of absolute disconnection between transactions. Coins sent from one wallet to another had no connection except perhaps to the most determined of analyst.
However, these days the only option available is ‘Shared’ coin where one mixes in their transaction with a number of others thus muddling precisely who has sent coins to who.This is not fool-proof as a method since a certain degree of ‘taint,’ which can be more easily analysed, remains and thus we might say that this method introduces a degree of plausible deniability. The process is also relatively slow since one’s transaction is occurring within a much larger pool than normal and thus confirmations can take a little while to process.
In this sense we can safely call ‘Shared Coin’ a medium-term solution for those who simply wish not to have openly transparent transactions, but who are not absolutely attempting to disguise their wallet interactions. This service is likely to suit most casual Bitcoin users and darknet market customers will surely find it appealing in their efforts to at least provide some basic cover for their interactions with the various marketplaces. Darkcoin’s Darksend may make this requirement obsolete as a general wallet feature, but for now thisis the best option for most users. There is no extra cost to Sahred Coin beyond standard transactions fees (and if one chooses to increase repetitions a donation of 0.5% is asked for, but not required).
A more recent mixing service is Bitmixer (https://bitmixer.io/) whose entry to the market is relatively new. In such cases a certain degree of caution should always be carried by anyone employing it. Bitmixer draws upon its own pool of Bitcoin reserves and each deposit arrives at the end of the chain. The top end of the chain is used to further one’s deposit amount to a forwarding address thus breaking the link between wallets as one desires. It is an interesting service although it is not the easiest to use. The site design remains a little confusing and it is the opinion of this writer that a more direct input/output field should be implemented by the service. This is to avoid problems from users depositing funds, not waiting long enough for the deposit, and then trying to forward too early.
When this occurs one is provided with a new address with no real sense of whether this process has worked until the coins arrived at the desired destination. This is not a major flaw, but simply one that can be surely seen as a possible bug to be ironed out. That being said in terms of speed bitmixer.io offers the best short-term solution to disconnecting wallets albeit by placing their trust in a centralised system built on a reserve of coins. Neatly a letter of Letter of Guarantee is provided for those wishing to contact support and
a brief generic test revealed support to be prompt in responding to inquiries. Their reserve wallet currently holds 1632.32 BTC which should keep them in shape for a while to come.
It is important to keep in mind that anonymity in using any such service depends on constant self-vigilance. Accessing the latter two should be, at a minimum, through a VPN and make sure to cycle your IP address as much as possible. Furthermore, it is wise to sign up with a throw away address and for Shared Coin and undertaking each process with a new wallet. Any contact with a centralised service, such as Bitmixer, should be taken from a dummy account too. This is best for both parties though the simple act of the deposit ties you to at least one particular action. It is our opinion that the sensible user of any dark net marketplace ought to plan their transactions in advance by mixing their coins through Bitcoin Fog over Tor after deciding on their purchase. Once this process has occurred they will be operating at, at least, a decent level of privacy. Coupled with astute use of PGP encryption oneis, then, only left at the mercy of customs.