Unpacking Tornado Cash: How Crypto Mixers Work

Tornado Cash operates as a decentralized mixer protocol on the Ethereum network, designed to obscure the transaction trail between senders and recipients. By pooling crypto assets and redistributing them, the protocol effectively breaks the on-chain link that typically makes transaction flows traceable on public blockchains.

The core mechanism works like this: users deposit funds into a smart contract pool, then withdraw from a separate address after a time delay. This separation disrupts the direct connection visible on the blockchain, providing a layer of privacy for participants concerned about transaction surveillance.

Our analysis breaks down the technical architecture behind Tornado Cash—how the zero-knowledge proof system validates transactions without exposing sender identities, why different deposit denominations matter for privacy, and the broader implications for DeFi privacy tools in an increasingly transparent blockchain ecosystem.