Crystal Blockhain: CoinJoin technology significantly complicates the deanonymization of bitcoin transactions

CoinJoin coin mixing technology really does the job of tracking Bitcoin transaction pathsmore complex, but in some cases this is not required. This was stated in the ForkLog magazine by the director of the product of the analytical service Crystal Blockchain Kirill Chikhradze.

To the question of whether use is reallythis technology makes useless the deanonymization tools that Crystal Blockchain and other companies (Chainalysis, Elliptic) offer, Chikhradze said:

“When it comes to unraveling mixers in general,then yes, this is a rather difficult task, although for compliance purposes you don’t need to demix transactions. It’s only important to understand that the money came from the mixer or went to it, and this is a fairly simple task with an analytical tool. ”

According to him, the task of analysts is to fully determine the set of mixer addresses.

“This is done both automatically, by analyzing patterns of behavior, and in manual mode, for example, by searching for references to the addresses of mixers on the network,”— he added.

Speaking about the tools that make it possible to unravel CoinJoin transactions as efficiently as possible, Kirill Chikhradze emphasized that although they exist, they work with some restrictions.

"Algorithm developed inside CrystalBlockchain allows you to unravel a family of CoinJoin transactions that satisfy a number of assumptions. One of them, for example, is the lack of financial conditions for the transaction. Based on this algorithm, you can also create a procedure that will reduce the level of anonymity for transactions of the JoinMarket class, however, it can still be difficult to unambiguously compare the inputs and outputs ”,— Chikhradze said.

One of the most famous wallets,supporting CoinJoin technology, wasabi. Commenting on the words of the representative of Crystal Blockchain that mixers complicate the task of deanonymizing transactions, technical director of the development company Adam Fichor said:

“It's good to hear about it. It seems like they can’t do anything with Wasabi, and all they have to do is flag transactions. ”

At the same time, he did not agree with the opinion thatLast year, one of Chainalysis employees expressed a question and answer session on Reddit in an open session. According to him, Wasabi is an enemy number for blockchain analysis companies, and if all Bitcoin users turned to CoinJoin, Chainalysis and their colleagues would simply go bankrupt.

“Unfortunately, with high commissions, allowingNot everyone can use Wasabi. Yes, it is suitable for providing individual privacy, but it costs money. For example, if a normal Bitcoin transaction costs $0.01, the same transaction using Wasabi mixing will cost $1. Now imagine that commissions will increase in price by 100 times. In this case, a normal transaction will cost $1, a transaction using Wasabi — $100. You will, of course, only do normal transactions.", — Adam Fichor said.

Recall Crystal Blockchain service,designed to identify and investigate criminal activity in the Bitcoin blockchain, the blockchain solutions provider Bitfury Group introduced in January 2018.

It was created to track the movement of suspicious transactions to the final recipient or point of sale of the cryptocurrency in order to comply with legal compliance and / or conduct investigations.