New ‘Sinbad’ Bitcoin Mixer Unmasked As Formerly Sanctioned Blender

A federally sanctioned “coin mixer” used by criminals to launder money appears to have been relaunched under a different name, according to a blockchain analytics firm.

"Blender is back," crypto researchers Elliptic said on Monday, explaining that the app that was sanctioned last year by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) had “highly likely” been re-launched as Sinbad.

Coin mixers are platforms that allow people to anonymously send and receive cryptocurrencies like Bitcoin or Ethereum by combining them to obfuscate their source and destination. Criminals who want to launder money or cover their tracks after stealing crypto typically use coin mixers to cover their tracks.

Sinbad is the coin mixer that North Korean state-sponsored hacking group Lazarus Group uses now. “Sinbad has laundered close to $100 million in Bitcoin from hacks attributed to Lazarus, to date,” Monday’s post read. 

Elliptic added that after Blender was shut down, Sinbad “soon began to be used to launder the proceeds of Lazarus hacks.” 

The FBI says that Lazarus is the group behind a number of crypto hacks, such as the Horizon hack, where thieves took $100 million. 

Last year, according to OFAC, Blender was used by hackers in North Korea to “support its malicious cyber activities and money-laundering of stolen virtual currency.” The app closed in April 2022, but since then, Sinbad has since been active. 

Elliptic claimed today that “tens of millions of dollars from Horizon and other North Korea-linked hacks have been passed through Sinbad to date and continue to do so, demonstrating confidence and trust in the new mixer.” 

Coin mixers made headlines last year when the OFAC blacklisted U.S. citizens from using Tornado Cash, an Ethereum coin mixer also used by Lazarus. 

Bitcoin Mixers Are Busier Than Ever in 2022: Chainalysis

While privacy advocates tout cryptocurrency mixers as an important way to protect individual users’ identities, a new report from blockchain intelligence firm Chainalysis says that the largest portion of crypto sent to mixers this year has been from cybercriminals and nation states. "Illicit addresses account for 23% of funds sent to mixers so far in 2022, up from 12% in 2021," Chainalysis reports. The firm acknowledges that there are many legitimate reasons to use mixers, such as trading crypto...

But politicians and some in the crypto community—like San-Francisco-based digital asset exchange Coinbase—have attacked the authorities for banning it, claiming that privacy is a right and that criminals are not the only users of such crypto tools.