Coin mixers are services that help obfuscate the origin and destination of cryptocurrency transactions, allowing users to send funds without revealing their identity. Privacy advocates argue they are essential for protecting anonymity, while government officials see them as tools for money laundering. Coin mixers operate by pooling coins from multiple users, enabling withdrawals from different addresses to break the on-chain link between sender and recipient. Although they have legitimate uses, such as maintaining privacy in financial transactions, they are also popular among cybercriminals. Controversies around mixers intensified following the U.S. Treasury's sanctions against Tornado Cash, which processed over $7 billion in crypto since its launch in 2019, with a significant portion linked to illicit activities. In November 2024, the U.S. Fifth Circuit Court ruled against the Treasury's authority to sanction Tornado Cash's smart contracts, complicating the regulatory landscape for mixers. Projects like Railgun aim to provide privacy while remaining compliant with laws, highlighting an ongoing debate about balancing privacy rights and regulatory measures in the cryptocurrency space.

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