Does a bitcoin tumbler make bitcoin a true store of value?
When the going gets tough, and world events begin to take their toll on global markets and currencies, investors generally duck into one of the two aforementioned assets.
The purpose of a store of value is, essentially, to hold its value in the face of declining values for other assets. Bitcoin, otherwise known as digital gold, is trying to become just such an asset, but unless you use a bitcoin mixer to anonymize it, it doesn’t have enough security to be considered a true SoV asset.
A bitcoin tumbler clears away a bitcoin’s transaction history, leaving the investor with a clean asset that is untraceable. If you’re holding clean BTC in your wallet, then you do have a true SoV asset. If not, then your BTC can easily be stolen by cyber-criminals or seized by authorities.
Before getting into the threats to BTC, however, let’s unravel the meaning of a store of value asset a bit further.
Is bitcoin a store of value?
A store of value asset generally maintains – or increases – its value during times of recession, war, or other disruptions to the normal flow of business and economics.
So, while bitcoin’s store of value argument is beginning to materialize, what is left is for investors who are treating it as such to have a secure way of storing it. After all, what good is having a store of value asset if you can’t store it safely?
That’s where using a bitcoin mixer comes in. Bitcoin, as it is now, has remarkable provenance properties. It is extremely simple to determine where a particular bitcoin has come from my simply starting at one wallet, viewing transactions its been involved in, and clicking away through the transaction history.
In theory, you can trace any bitcoin back to its mint by walking in reverse this way. While that may be great for accountability and transparency, it’s pretty awful for your wallet’s security.
Anyone can see inside your wallet, and anyone can trace/track your transactions. Eventually, someone with enough sophistication and the proper technique can figure out your IP address and simply take your BTC.
So, transparency is great in some respects, but terrible when it comes to securing your store of value wealth. That’s why bitcoin mixers exist – they serve to protect your bitcoin and help it achieve its purpose.
Using a bitcoin tumbler to secure your wallet
A bitcoin tumbler is a simple tool designed to anonymize your bitcoin. What this means, in effect, is that your old wallet that is full of transaction history is left behind for a new wallet without any discernible connection between the two.
It’s like getting a fresh start on the blockchain. After using a blender, no one will be able to figure out where you bitcoin has come from, meaning that it will be impossible to identify you in any way.
There are blender startups out there who have created user friendly bitcoin tumblers. Amongst them, Tumbler.io stands out for its simple user interface and highly secure procedural steps.
When you create an order on the landing page, you’re given a unique one-time deposit address where you are to send your BTC within 24 hours. After doing so (and specifying your new BTC wallet address), the tumbler takes your old BTC, then sends anonymous BTC to your new address.
Once received, you can safely store your new, anonymized BTC in the wallet without fear of being hacked or identified in any way. A bitcoin tumbler is a lot like a filter – it removes the impurities of your BTC while keeping just the essence.
And, like when using a filter, every time you are going to add more BTC to your wallet, you should anonymize it again. In this way, every time you receive BTC from another wallet, you should pass it through Tumbler.io to remove any identifiers and transaction history from it.
After doing so, you can securely store your BTC and rest easy knowing that it is now fulfilling its store of value purpose.
Does bitcoin hold Its value?
Store of value assets are supposed to hold their value. The question is, does bitcoin hold its value?
Bitcoin experiences dramatic intraday price swings, but history teaches us that over the years, bitcoin has seen extreme year on year gains. At the end of the day, your perspective about the value growth of BTC depends on when you got into the asset.
If you bought in 2011, then today, you are significantly in the green and likely feel that BTC is an incredible store of value asset.
If you bought at the end of 2017, then today you probably feel that BTC is a terrible store of value asset.
However, if you buy BTC at the start of a period of instability and plan to hold through to the end of that period, then the likelihood of BTC staying in or near that value is high.
Recently, the potential of bitcoin as a store of value has been tested by the global coronavirus pandemic. While the asset has not yet experienced a large influx of investor cash, the movement of cash from traditional assets to SoV assets is just beginning.
If you are coming to bitcoin to store your wealth through a period of turbulence, then make sure to follow the above recommendations – pass your BTC through a bitcoin mixer to keep it safe. Without taking the necessary precautionary steps, your SoV asset may turn out to be just the opposite.
Disclaimer: This article is not intended to provide financial advice or promote the use of Bitcoin and other cryptocurrencies. Its main purpose is to inform, explain, and educate. Readers must make their own decisions regarding the use of such services.