U.S. Treasury: Cryptocurrency mixers can serve legitimate privacy needs

According to Financefeeds, the U.S. Department of the Treasury acknowledged in a report submitted to Congress titled "Using Innovative Technology to Combat Illegal Financial Activities Involving Digital Assets" that cryptocurrency mixers can serve legitimate privacy purposes.

The report points out that as consumers increasingly use digital assets for payments, individuals may wish to use mixers to maintain privacy in their spending. Legitimate users may utilize mixers to prevent sensitive information, such as personal wealth, business payments, or charitable donations, from permanently appearing on public blockchains. However, the Treasury also warns that non-custodial or decentralized mixers carry higher risks and are often used for money laundering and evading sanctions. The report specifically mentions that cybercriminal groups associated with North Korea have used cryptocurrency mixing services to transfer and conceal stolen funds. In contrast, custodial mixers can provide greater visibility for law enforcement due to their ability to collect user identification information.