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Comment by mars | Hacker News Reader

that's common practice to anonymize bitcoins. google 'bitcoin tumbling service'.

If any scenario that 'blacklists' some bitcoins is implemented (IMHO it won't, but if we're discussing it..), then any bitcoins 'tumbled together' with blacklisted bitcoins would be blacklisted as well.

Which would mean that either people would stop using tumbling services (since the process would turn 'good' bitcoins into 'tainted' bitcoins as soon as a single participant wanted to anonymize stolen BTC), or tumbling services would disallow tumbling any blacklisted bitcoins, or both.

So do you think that these 429k bitcoins were all sent through a tumbler? Now that would be interesting information.

Can we verify this? Obviously we can't trace the outputs, but can we look for patterns that suggest the use of tumblers/mixers?

well, that's the whole purpose of a tumbling service. i mean you don't even know how long they will be stuck there. i didn't investigate this, but splitting those into small amounts and then tumbling these around seems like exactly this pattern. if you are interested on how this was done in the maybe now second biggest known btc heist check http://www.newstatesman.com/future-proof/2013/12/theres-£60m...

To be honest, tumbling such large amount of BTC serves no purpose because you overflow the rest of the people tumbling.

Tumbling only works if you're a small fraction of the total. If you put $300 million into a tumbler that only has $1 million of other volume, then it's pretty easy to track you.

Sure, but if you have access to $300 million and want to tumble $1 million, wouldn't it be hard to track you?

Sure, but you don't tumble it all at once. Other commenters showed that these BTC were split up into ~1000 BTC chunks. Each of those could send randomly to different tumblers and anonymize all of their activities to send to a new set of addresses which people aren't tracking, and then from there gradually pull it out of various exchanges to various banks and accounts.

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