CoinJoin, a Bitcoin privacy technology, conceals more than $6 million in a single transfer.

By looking at the magnitude of a recent CoinJoin transfer, it appears that more people are eager to employ Bitcoin’s onchain anonymity techniques.

Bitcoin’s privacy tool, CoinJoin, fuses over 209 BTC

On April 20, 209.70283337 BTC was fused by a Bitcoin CoinJoin with 351 inputs, verifying it on-chain before being distributed through 336 outputs.

A examination of obituaries reveals that Bitcoin has been “buried” over 470 times in the past 14 years.

At the time, the CoinJoin enabled the private transfer of more than $6 million worth of value via the Bitcoin network while safeguarding senders’ and recipients’ identities.

Bitcoin is pseudonymous, which enables the decryption of the sender’s and recipient’s identities. Mapping is simpler because it is easy to decipher the identity of the transactors using specialised agents like Chainalysis because all on-chain transactions can be traced.

CoinJoin is a method that makes sure transactions cannot be traced, protecting the anonymity of Bitcoin users. Greg Maxwell came up with the idea for the solution in 2013, but others, including those behind the Wasabi wallet, developed it. As inputs, it mixes up many bitcoin transactions, which are then confirmed on-chain as a single CoinJoin. After that, receivers receive the single transaction.

This architecture makes it more difficult for agents tracking transactions to distinguish between them, protecting users’ identities. The more inputs, however, the more effective CoinJoin is; the more inputs, the more private transactions are.

Limitations and adoption

With the most recent CoinJoin on April 20, one of many that have been carried out over time, the procedure has been duplicated.

Although the size of the CoinJoin may be constrained by internal constraints on the Bitcoin network, such as block size and coordination of the number of users sending transactions in a single block simultaneously, the method is well-liked by users.

But unlike Tornado Cash, a popular cryptocurrency mixer for ERC-20 tokens, CoinJoin blocks flagged bitcoin transactions, preventing criminals from using the platform to resell stolen goods.

The manufacturer of hardware wallets, Trezor, included Coinjoin on its Trezor Model T on April 19. There will still be choices for other account types, like SegWit, Taproot, and Legacy. CoinJoin is an alternative, although it comes with a 0.3% coordination cost and a somewhat longer confirmation delay.