News • CoinJoin, a popular Bitcoin (BTC) mixing tool, will automatically block transactions marked as illegal. The news comes from the official Wasabi Wallet Twitter account, of which CoinJoin is a part: "The zkSNACKs coordinator will start rejecting certain UTXOs, preventing them from registering with CoinJoin." The zkSNACKs coordinator will start refusing certain UTXOs from registering to conjoins. pic.twitter.com/X3kBuQwieO - Wasabi Wallet (@wasabiwallet) March 13, 2022 These privacy-oriented mixing tools are mainly used to obscure the origin of transactions, and are often seen as a means of laundering illicit funds. However, as the blockchain is a public ledger and there are several forensic tools developed by companies such as Chainalysis, being able to launder money through mixing has become very difficult in recent years. The company's latest announcement angered many privacy advocates, who accused Wasabi Wallet of bowing to law enforcement. However Rafe, a developer of the company, pointed out that this new directive in no way compromises the core values of Wasabi: “The authorities infiltrated Wasabi via the threat of punishment. Therefore, to protect yourself in the long term you will need blockchain analysis tools and monitoring of inbound and outbound transactions. They essentially spy on their users… users who use this product for privacy reasons. " “Nobody infiltrated Wasabi, we wouldn't have had this conversation if they did. There is no need to spy when banning inputs. Many would be happy to sink with the ship when needed, but now tell me: would you rather have no zkSNACKs coordinator, or would it be kept active for the majority of users? " No one has infiltrated Wasabi, since we wouldn’t be having this conversation if that were the case. There’s no need to spy when banning inputs.
Many would be happy to sink with the ship when needed. Is it better to have no zkSNACKs coordinator or to keep it running for the majority? - Rafe ⚡ (@BTCparadigm) March 14, 2022 Rafe also pointed out that UTXO blocking is limited to the zkSNACKs coordinator, and people are free to use any other coordinator if they prefer. Adam Fiscor, founder of Wasabi Wallet, however admitted that this could pose a threat to Bitcoin's fungibility: “Blacklisting has come to CoinJoin. In my opinion, this is a major defeat for Bitcoin's fungibility. " Blacklisting arrived to conjoins. IMO it is a major setback to Bitcoin's fungibility. - nopara73 (@ nopara73) March 14, 2022 Numerous governments and centralized entities have brought forward the idea that cryptocurrencies are mostly used for illicit activities, especially criticizing the role played by privacy wallets and mixing tools. However, research and data analysis have shown that the use of cryptocurrencies for illegal activities represents a very small fraction of total transactions; Furthermore, as more and more powerful analytical tools emerge, using crypto for illegal purposes becomes increasingly difficult. According to data from Chainalysis, in 2021 only 0.15% of all crypto transactions were linked to illegal activities. We remember the recent arrest of a couple, husband and wife, while trying to launder the stolen money following the multi-billion dollar hacker attack against Bitfinex: in this case the police were able to recover most of the stolen BTC thanks to blockchain tracking tools.