History of Bitcoin Mixers

by NotATether

The concept of mixing bitcoins dates back to at least 2010 when Bitcointalk and various online communities started discussing the need for improved privacy features. The first Bitcoin mixer, known as Bitcoin Laundry (also called BitLaundry), is believed to have been launched around this time. Bitcoin Laundry allowed users to hide their funds by sending bitcoins to the service and receiving other bitcoins forwarded from the service.

The first bitcoin mixer to make use of blind signatures was called Blindbitcoin, announced on June 2011. Blind Signatures are a cryptographic process created by David Chaum which hide the contents of a message before it is signed with a digital signature such as DSA, or ECDSA in the case of Bitcoin. The idea for mixers to use variable fees was proposed on June 2012, around the same time the first mixer hack occurred (and the second).

Ironically, that mixer started a claims page, which directed users to perform identity verification to receive their funds back. Don’t ask me how it got to that. Such a thing would be unspeakable in the present day. Even Blockchain dot com was running a mixer at the time (surprise!).

Also it should be noted that the bitcoin mixer list does not have any of these mixers listed because they appear to have been taken offline a long time ago, but by their owners at least, not any government.

Even back in 2012, there were bitcoin mixers that were running as scams, you wouldn’t be surprised, I hope. Especially on Bitcointalk, moderators would proactively label a service as a possible scam at that time. (Nowadays the forum is so rampant with scammers and bounty spammers that I think they gave up.) Even Tor hidden sites were in on the act.

If you opened some of the links above, you might have noticed that service operators stored the bitcoin mixer’s coins on an exchange like Mt Gox. Granted, this predated CoinJoin, and nowadays you can’t run a mixer from an exchange since there are heightened AML regulations. It’s worth noting that the bitcoin mixer list has actually become safer than it was during bitcoin’s early days.

Btw, did you know that back in 2013, The Bitcoin Foundation (yeah, the one that spectacularly imploded) had a proposal to set up a gigantic mixer service to mint anonymous bitcoins for the public? They never made one, because they didn’t want governments to accuse them of money laundering.