Crypto tumbler is a service that mixes your cryptocurrency transaction with other transactions, eliminating the possibility of someone discovering the party that originated the coins. This is useful if you’re worried about being identified when sending crypto token or simply want the plausibility of deniability.
Bitcoin transactions are recorded on the blockchain, which is a public record that’s available for anybody to see. With some basic analysis tools and knowledge of the blockchain’s structure, it can be relatively easy to trace a coin or transaction back to its original wallet. That’s not great if you’re trying to hide illegal activity, or even if you just don’t want people tracking your crypto purchases.
The best way to think of a tumbler is like a blender. You send your bitcoins or other cryptocurrency to the tumbler, it blends them with a bunch of other coins from different users, and then spits the new combination out to random addresses. In some cases, the tumbler will also mix your coins with other currencies like Litecoin or Ether to further randomize them. The tumbler then takes a small transaction fee, usually 1-3% of the total amount mixed.
Tumbler services are often centralized and custodial, meaning that you’re trusting the tumbler with your crypto. Some are free, but others can cost a significant amount of money to use. This is why it’s important to research the tumbler you plan on using before making a purchase. Crypto tumbler