Tracking Mixed Bitcoins

TL;DR

This paper presents a novel address taint analysis method to track Bitcoins through mixers, demonstrating it can effectively link deposited and withdrawn coins and reduce false positives.

Contribution

Introduces address taint analysis for tracking mixed Bitcoins, combining it with clustering and filtering to improve accuracy over existing methods.

Findings

Effective tracking of mixed Bitcoins using address taint analysis.

Filtering criteria significantly reduce false positives.

Successful evaluation on nine mixer services.

Abstract

Mixer services purportedly remove all connections between the input (deposited) Bitcoins and the output (withdrawn) mixed Bitcoins, seemingly rendering taint analysis tracking ineffectual. In this paper, we introduce and explore a novel tracking strategy, called \emph{Address Taint Analysis}, that adapts from existing transaction-based taint analysis techniques for tracking Bitcoins that have passed through a mixer service. We also investigate the potential of combining address taint analysis with address clustering and backward tainting. We further introduce a set of filtering criteria that reduce the number of false-positive results based on the characteristics of withdrawn transactions and evaluate our solution with verifiable mixing transactions of nine mixer services from previous reverse-engineering studies. Our finding shows that it is possible to track the mixed Bitcoins from the deposited Bitcoins using address taint analysis and the number of potential transaction outputs can be significantly reduced with the filtering criteria.