crypto Mixers: A Double-Edged sword in the Wake of Major Hacks
On February 21, 2025, a staggering $1.5 billion in ETH was stolen from the Bybit exchange. According to Elliptic analytics, the Lazarus Group is the likely culprit. The stolen funds were quickly sent to crypto mixers for laundering. This isn’t the first time mixers have been used in such a manner. Just a day later, thieves stole $50 million in USDC from Infini, also using a mixer.
Elliptic reports that the Bybit hack is the largest heist ever, not just in crypto exchanges.within two hours, 400,000 ETH were spread across 50 addresses. By February 23, 10% of these wallets were emptied. The stolen funds may undergo more transactions, including swapping and using cross-blockchain bridges.
The eXch exchange is currently the main tool for laundering the Bybit hack funds. The final step involves obfuscating transactions via crypto mixers, a challenging task due to the large volume of stolen funds.
Crypto mixers are tools that hide transaction details, making them popular among criminals. Though, they also serve legitimate users who value privacy. The debate over their legitimacy continues. Bitcoin Fog, for example, helped launder 1.2 million bitcoins between 2011 and 2021,leading to its creator’s imprisonment.
Three Tornado Cash team members were arrested in the 2020s. Developer Alexey Pertsev was freed in February 2025 but still faces legal battles. The case highlights the need for modern regulations that fit crypto platforms.
Privacy-focused tokens like Monero are also under scrutiny. while some exchanges delist them, Monero outperforms Bitcoin on some marketplaces. The future of crypto mixers remains uncertain.Some countries may ban them, while others, like the U.S., might allow them.
Elliptic reports that even innovative platforms like Railgun, supported by Vitalik Buterin, have been used by Lazarus Group. The near future will likely see two trends: the U.S. and allies leaving crypto mixers as they are, and other countries being stricter.
