A group of extremely savvy analysts started evaluating how much and where ETH transactions were being processed. What they found was a bit of a surprise.
According to the analysis, over 65 percent of all ETH transactions
are generated using temporary addresses. In other words, funds come
into the address and leave the address again, usually within an hour,
and the addresses are never used again.
The finding, on the cyberFund blog, indicates that an ‘Ethereum
mixer’ is moving funds into temporary addresses, mixing them around
from address to address, and then outputting them into more fixed
addresses on different exchanges. The graphic below indicates the
process.
The issue with these transactions is that they represent a
massive part of all Ethereum transactions taking place, indicating that
funds are being moved rapidly, and for some purpose that is not
evidently clear. The analysis that at least one of the following
possible options must be true of the mixer.
Avoiding controls
1. The protection offered to clients by crypto-exchanges:
all clients’ funds are mixed so that the funds’ sources cannot be
tracked and those holding clean money cannot be unjustifiably accused of
any illegal activity
2. A mechanism set in place to protect US residents who wish to avoid control from US regulatory bodies
3. A mechanism used by a large private exchange to preserve
the privacy of its clients; this exchange might be operating with fiat
money
4. A mechanism used to securely transfer crypto-assets between crypto-exchanges
5. Any kind of Ethereum-laundering scheme
Which of these options is actually the purpose remains to
be seen. However, if such a high volume of transactions is being carried
out by a single mechanism, it calls into question the market growth of Ethereum and its actual use.
