Towards understanding and demystifying bitcoin mixing services

Lei Wu, Yufeng Hu, Yajin Zhou, Haoyu Wang, Xiapu Luo, Zhi Wang, Fan Zhang, Kui Ren

Research output: Chapter in book / Conference proceedingConference article published in proceeding or bookAcademic researchpeer-review

Abstract

One reason for the popularity of Bitcoin is due to its anonymity. Although several heuristics have been used to break the anonymity, new approaches are proposed to enhance its anonymity at the same time. One of them is the mixing service. Unfortunately, mixing services have been abused to facilitate criminal activities, e.g., money laundering. As such, there is an urgent need to systematically understand Bitcoin mixing services. In this paper, we take the first step to understand state-of-the-art Bitcoin mixing services. Specifically, we propose a generic abstraction model for mixing services and observe that there are two mixing mechanisms in the wild, i.e. swapping and obfuscating. Based on this model, we conduct a transaction-based analysis and successfully reveal the mixing mechanisms of four representative services. Besides, we propose a method to identify mixing transactions that leverage the obfuscating mechanism. The proposed approach is able to identify over 92% of the mixing transactions. Based on identified transactions, we then estimate the profit of mixing services and provide a case study of tracing the money flow of stolen Bitcoins.

Original languageEnglish
Title of host publicationThe Web Conference 2021 - Proceedings of the World Wide Web Conference, WWW 2021
PublisherAssociation for Computing Machinery, Inc
Pages33-44
Number of pages12
ISBN (Electronic)9781450383127
DOIs
Publication statusPublished - 19 Apr 2021
Event2021 World Wide Web Conference, WWW 2021 - Ljubljana, Slovenia
Duration: 19 Apr 202123 Apr 2021

Publication series

NameThe Web Conference 2021 - Proceedings of the World Wide Web Conference, WWW 2021

Conference

Conference2021 World Wide Web Conference, WWW 2021
Country/TerritorySlovenia
CityLjubljana
Period19/04/2123/04/21

Keywords

  • Anonymity
  • Bitcoin
  • Mixing Service
  • Pseudonymity

ASJC Scopus subject areas

  • Computer Networks and Communications
  • Software

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