One of the basic regulations of blockchain technology is to provide users with unwavering privacy. Bitcoin as the first ever decentralized cryptocurrency relied on this premise to market to a wider audience that then needed a virtual currency without government interference.
Unfortunately, Bitcoin has proven to be fraught with several weaknesses along the way, including non-scalability and a variable blockchain. All transactions and addresses are written on the blockchain, making it easy for everyone to connect the dots and reveal users ’private details based on their existing records. Some governmental and non-governmental agencies already use blockchain analytics to read data on the Bitcoin platform.
Such flaws have led developers to explore alternative blockchain technologies with improved security and speed. One of these projects is Monero, which is usually represented by an XMR ticker.
What is Monero?
Monero is a privacy-focused cryptocurrency project whose main goal is to provide better privacy than other blockchain ecosystems. This technology protects user information through hidden addresses and ring signatures.
An invisible address refers to the creation of a single address for a stand-alone transaction. Two addresses cannot be attached to one transaction. The received coins go to a completely different address, which makes the whole process unclear to an outside observer.
A ring signature, on the other hand, refers to mixing account keys with public keys, thus creating a “ring” of multiple signatories. This means that the monitoring agent cannot associate a signature with a specific account. Unlike cryptography (a mathematical method of securing crypto projects), a signature ring is not a new child in the block. Its principles were researched and recorded in a paper in 2001 by the Weizmann Institute and MIT.
Cryptography has certainly won the hearts of many blockchain developers and fans, but the truth is that it is still a newborn tool with a handful of uses. Since Monero uses the already tested Ring signature technology, it stood out as a legitimate project worth adopting.
Things to know before you start trading Monera
The Monero market is similar to the market for other cryptocurrencies. If you want to buy it, some of the exchanges to visit are Kraken, Poloniex and Bitfinex. Poloniex was the first to adopt it, followed by Bitfinex and finally Kraken.
This virtual currency appears to be mostly pegged to the dollar or to other cryptocurrencies. Some of the available pairings include XMR / USD, XMR / BTC, XMR / EUR, XMR / XBT and many others. The volume of trade and liquidity of this currency are recorded by very good statistics.
One of the good things about XMR is that anyone can participate in its mining either as an individual or by joining a mining fund. Any computer with significantly good processing power can mine Monero blocks with a few hiccups. Don’t bother with ASICS (application-specific integrated circuits) that are currently mandatory for Bitcoin mining.
Although it is a frightening cryptocurrency, it is not so special when it comes to instability. Virtually all altcoins are extremely volatile. This should not worry any passionate trader because this factor is what makes them profitable in the first place – you buy when prices are falling, and you sell when they are on a rising trend.
In January 2015, XMR cost $ 0.25 and then ran at $ 60 in May 2017 and is currently bowling above the $ 300 limit. The Monero coin recorded its ATH (highest maximum) of $ 475 on January 7, before it began to fall along with other cryptocurrencies to $ 300. At the time of writing, almost all decentralized currencies are in the price correction phase, and Bitcoin is fluctuating between $ 10-11,000 from its famous $ 19,000 ATH.
Interchangeability and adoption
Thanks to its ability to offer reliable privacy, XMR has been adopted by many people making its coins easy to exchange for other currencies. Simply put, Monero can easily be mistaken for something else.
All Bitcoins in the Bitcoin Blockchain are recorded, so when an incident like theft occurs, the operation of any coin involved will be avoided making them immutable. With moner, you can’t tell one coin from another. Therefore, no vendor can refuse any of them because it is related to a bad incident.
The Monero blockchain is currently one of the trend cryptocurrencies with a significant number of followers. Like most other blockchain projects, its future looks great, although government repression is threatened. As an investor, you need to perform a detailed analysis and research before trading any cryptocurrency. Where possible, seek help from financial experts to take the right path.