Distributed and Hash-Based Mixers for User Anonymity on Blockchain

Bitcoin, the first successful application of Blockchain Technology, took the world by storm when it was launched in 2008. It promised a peer-to-peer financial system without involving a third party. Since then, security and privacy have been two of the most marketed features of Blockchain technology and cryptocurrencies. Despite anonymity being one of the core features, several methods have been designed to infer a user’s identity on the Blockchain network. This study discusses the privacy concerns on a Blockchain regarding the anonymity of users and analyzes the existing methods to prevent the de-anonymization of users. The work also presents an improved mechanism to protect user anonymity on Blockchain using a hash-based approach. The simulation results demonstrate how a user can make a transaction to their desired destination from addresses unrelated to their own while simultaneously maintaining their anonymity on the network.