If you are transacting in a business environment, I think it is an added benefit if the counterparty in the transaction can't deduce information out of your transaction. Such as how much assets you have, to what other services have you been sending funds and so on. As Bitcoin does have public ledger, and if you just use single address and don't do any privacy enchancing practices, lots of information could be deductible using blockchain analysis.
I would also suspect that using data collected by governments is used for business advantage. Of course it is hard to prove quite often. Personally I think that in principle it just doesn't make sense to spread your data around, as the benefits are tiny and the potential downsides can be big.
Using Tornado was pretty common among well known/higher profile people in the space to avoid causing inadvertent market effects or leak info about upcoming projects.
Basically if you were high profile enough, people would watch your wallets to see what you were investing in/transacting with, and use that as market intelligence.
As far back as 2016 or so I recall someone specifically offering their blockchain analysis platform as a way to do this.
So you would use tornado to make the money you planned to invest/use appear "somewhere else" disconnected, to maintain privacy/security of a project.
Tornado and mixers and such become necessary specifically because all transactions are public - unlike in tradfi where transactions are opaque except to parties and intermediaries.
Similarly to how investors in tradfi tend to keep their investment strategies secret where possible.
Also, if you want to be able to create legitimate projects that are not tied to your real-world identity, you need a break between bank -> exchange -> address -> ??? -> contract deployment address.
Scenario one. Individual (while working in a startup) is receiving some tokens as a compensation. Time passes. Their remuneration being on-chain and visible is a problem when negotiating salary in the next job.
Scenario two. I want to have on-chain identity (e.g. exo762.eth domain name). To register it I need to have some ETH (gas, registration fee). If I sent this ETH directly from my "money" account, I will forever link my public identity to my money, which is like walking around with "my net worth is at least XYZ USD" banner.
How are these scenarios "use cases" for a mixer and not critical flaws in the underlying system?
We're in a thread about a rogue state using the tech to steal money to fund their operations (Chemical attacks in airports, nuclear warheads, intercontinental ballistic missiles, etc.) How many nuclear detonations would you consider acceptable in exchange for the cryptobros to have their toys?
How many would you consider acceptable to have an international banking system? North Korea hackers stole $81 million from the Bangladesh central bank, and it was only a fluke that they didn't get away with over a billion from that one hack.
More prosaic wire fraud is common in real estate and B2B transactions, and if not noticed immediately the funds are often lost after being transferred internationally and cashed out. It wouldn't be surprising if NK is behind some of that, given what they managed against Bangladesh.
Providing some basic financial privacy, not from the government but from the general public. Everything on chain is public. When you buy something or transfer money to a friend, you don't necessarily want the recipient to know how much money is in your account, or what other addresses you've sent money to.
Lots of good examples already mostly geared around minimizing bits leaked for the sake of alpha, but there are also instances where it is desirable to be "locally clandestine" even if you're a full throated supporter of the powers that be on the whole. Persecution does not just come by way of financial penalties or the legal system, these tools are useful for avoiding social consequences as well. A hypothetical I'd expect to play well here: paying for an abortion in a large state where it is legal, but in a small town where the local church wields an immense amount of influence.
I would also suspect that using data collected by governments is used for business advantage. Of course it is hard to prove quite often. Personally I think that in principle it just doesn't make sense to spread your data around, as the benefits are tiny and the potential downsides can be big.