A tumbler is system used for bitcoin or crypto currency mixing . It’s purpose is to obfuscate bitcoin transactions so that the bitcoin addresses cannot be linked to any particular transaction.
The tumbling process takes several steps, and can be done in rounds. The main principle behind it is the fact that every bitcoin transaction has a “from” address , which contains coins from previous transactions minus a fee, and a “to” address containing coins from the incoming transfer minus a fee. As bitcoin transactions are not tied to bitcoin addresses with an ID per se, but merely with you being able to prove ownership of an address if you have a keypair consisting of private and public keys, it becomes possible for someone to send bitcoins from one address to several other bitcoin addresses , which means that you can’t really tell if a bitcoin came from your tumbling service or not. This is why people like to use bitcoin mixing services.
The first step of the process is to deposit the bitcoin into the transaction pool of the tumbler. Then, after it’s been mixed, it has to be sent through several different transactions until finally getting sent back to where it came from. Each transaction consists of signing one key from your bitcoin wallet and sending it with your bitcoin to someone who just joined the network as a new user, minus a fee for joining. This way, any blockchain analysis will show that those bitcoins have been passed around between various users. In fact, bitcoin anonymizers mean that BTC cannot even be moved out of an account without being combined with coins from unspent bitcoin transactions.
As bitcoin is entirely traceable, there are services that help you obfuscate bitcoin and crypto currency movements by mixing it with other users’ bitcoin along the way. These services create a certain degree of anonymity for bitcoin users. The problem with these systems is that no one knows if they’re trustworthy, as there are instances of tumblers stealing bitcoin .
Another danger is that some tumbling services might run away with your bitcoin . However, this risk is minimized by using two or three different tumbling services at once , which makes it harder to get scammed. When the bitcoin has been sufficiently mixed through several transactions, it can be sent back to an account where nobody can tell its origin . As more people use bitcoin and different bitcoin wallets, the bitcoin ecosystem becomes increasingly anonymous.