Following the arrest of the developers of Samurai Walletseveral other Bitcoin coin mixing operations see the writing on the wall and leave the United States for more crypto-friendly regions.
In April, the U.S. Attorney’s Office for the Southern District of New York charged Samourai Wallet founders Keonne Rodriguez and William Lonergan Hill with operating “a cryptocurrency mixer” that the agency said ran more than 2 billion dollars in illegal transactions and facilitated over $100 million in cash. laundering transactions with illegal dark web markets.
After the closure of Samourai Wallet, Wasabi Wallet developers ZKSnacks announced the preemptive shutdown of its mixer service, banning US customers from using its services.
“The Wasabi website and API are immediately inaccessible from the United States,” a Wasabi Wallet representative said. Decrypt. “ZkSNACKs is suspending its coinjoin service for all users at the end of May.”
Image: A notice that US customers see on the Wasabi Wallet website.
Hardware wallet Trezor followed suit on May 2, announcing that its mixing service would also be disappearing.
“We place great importance on the privacy of our users and it is with great regret that we must announce the discontinuation of the Coinjoin functionality for Trezor Suite by now [June 1] at the latest, because our partner will no longer provide this service”, Trezor wrote on Twitter.
American citizens are increasingly being excluded as the United States Securities and Exchange Commission (SEC) leads other regulatory and law enforcement agencies on a warpath against cryptocurrency.
The SEC has established a long history over which many critics, including regulators within the agency – called “regulation by enforcement.” It accused cryptocurrency mixer developers of acting as illegal money transmitters, while the US Department of Justice charged several cryptocurrency developers with money laundering.
A parts mixer or “coinjoin” is a service that allows users to hide the origin and destination of transactions. Users send cryptocurrency to the service, which is mixed with others before being relayed to the receiving address, thereby obscuring the connection between the sender and recipient.
In February 2023, the Sinbad Bitcoin Blender was revealed to be the renaming of Blender Bitcoin Blender, which had previously been shut down by federal regulators. By November, Sinbad was also offline, with the website seized by law enforcement.
Perhaps the best known mixer, Tornado Cashwas shut down in August 2022 after the US Treasury Department added the Ethereum mixing service to its list of Specially Designated Nationals, effectively banning US citizens from using the tool or transacting with its addresses.
A representative for Trezor and Samourai Wallet did not immediately respond to a request for comment from Decrypt.
Edited by Ryan Ozawa.
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