On How Zero-Knowledge Proof Blockchain Mixers Improve, and Worsen User Privacy
Zhipeng Wang, Stefanos Chaliasos, Kaihua Qin, Liyi Zhou, Lifeng Gao, Pascal Berrang, Benjamin Livshits, Arthur Gervais
Abstract
Zero-knowledge proof (ZKP) mixers are one of the most widely-used blockchain privacy solutions, operating on top of smart contract-enabled blockchains. We find that ZKP mixers are tightly intertwined with the growing number of Decentralized Finance (DeFi) attacks and Blockchain Extractable Value (BEV) extractions. Through coin flow tracing, we discover that 205 blockchain attackers and 2, 595 BEV extractors leverage mixers as their source of funds, while depositing a total attack revenue of 412.87M USD. Moreover, the US OFAC sanctions against the largest ZKP mixer, Tornado.Cash, have reduced the mixer’s daily deposits by more than .