The US Treasury Department, in a 32-page report delivered to Congress, struck an unusual tone: crypto mixing services can serve legitimate purposes. For years regulators painted mixers as havens for criminals. Now, the government acknowledges ordinary people use mixers to shield spending habits, business payments, or charitable donations on public blockchains like Bitcoin and Ethereum—where anyone can trace a wallet's history.
$1.6B Into Bridges, North Korea Took $900M
Yet the report doesn't sugarcoat the risks. Since 2020, more than $1.6 billion in mixed crypto moved into cross-chain bridges. Roughly $900 million of that flowed through a single bridge heavily linked to North Korean hacker groups such as Lazarus. Between 2024 and 2025, these groups stole at least $2.8 billion in crypto, often laundering it through mixers before cashing out.
About 12% of all mixed funds eventually pass through bridges—a technique that makes tracking even harder by moving tokens across different networks. The Treasury also distinguishes between "custodial" mixers run by companies, which are easier to regulate, and "decentralized" ones with no central operator, which pose bigger enforcement challenges.
Congress Asked for a 'Hold Law'
To counter these threats, the Treasury is urging Congress to pass a "hold law." This would empower crypto exchanges to temporarily freeze suspicious funds without a court order while they investigate. The goal: stop illicit money from moving before it disappears from reach.
By acknowledging mixers' valid uses, the report signals a shift toward recognizing privacy needs. But the proposed hold law—alongside the earlier CLARITY Act—shows the government isn't backing down on security. Expect heated debate in 2026 over balancing privacy and oversight. Custodial mixers may find a clearer path forward under rules, while decentralized ones face growing regulatory heat. Meanwhile, the Treasury warns users: using mixers or bridges can still lead to fund flags or freezes by exchanges. Check current regulations before acting.