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Bitmixer's Exit and Darknet Market Chaos: How Monero Stands to Benefit

The swift takedown of the darknet markets (DNMs) AlphaBay and Hansa, an announcement to exit the market from Bitmixer and the arrest of Alexander Vinnik for laundering $4 billion have all shown that fungibility is still an area for improvement for Bitcoin. As bitcoin shakes off its shady image, Monero has drawn increased attention. The privacy-focused cryptocurrency experienced an outburst over July 26, peaking at $46.99.

Bitmixer Announces Intention to Exit the Market

Not long after the two largest DNMs get taken down, the largest bitcoin mixer goes offline. Mixing services attempt to negate the public blockchain and provide anonymity. With the largest DNMs infiltrated, the exit of Bitmixer brings additional risk to using bitcoin for illicit purposes as it raises the question of whether mixing services are even safe anymore. The July 24 bitcointalk announcement from Bitmixer read:

“Hi all! Despite the huge profit we earn, we are closing our activity. Let me explain why. I’m bitcoin enthusiast since 2011. When we started this service I was convinced that any Bitcoin user has a natural right to privacy. I was totally wrong. Now I grasped that Bitcoin is transparent non-anonymous system by design. Blockchain is a great open book. I believe that Bitcoin will have a great future without dark market transactions. You may use Dash or Zerocoin if you want to buy some weed. Not Bitcoin. I hope our decision will help to make Bitcoin ecosystem more clean and transparent. I hope our competitors will hear our message and will close their services too. Very soon this kind of activity will be considered as illegal in most of countries. Cheers, Bitmixer.IO”

Bitcoin is having an image makeover it seems, courtesy of the U.S. federal government. Bitmixer’s announcement could be connected to AlphaBay, and perhaps operated as its internal mixer, as some forum members speculate. Or the mixing service may have been controlled by authorities the whole tim...

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