One of the key principles of blockchain technology is to provide users with confidential privacy. Bitcoin relied on this premise as the first decentralized cryptocurrency to market itself to a wider audience which then needed a virtual currency free from government interference.
Unfortunately, by the way, Bitcoin has proven to be fraught with a number of vulnerabilities, including unproven and changeable blockchain. All transactions and addresses are written in a blockchain making it easy for anyone to connect points and disclose users’ personal details based on their existing records. Some government and non-government organizations are already using blockchain analysis to read data on the Bitcoin platform.
Such errors have led developers to look for alternative blockchain technology with improved security and speed. One of these projects is Monero, usually represented by the XMR ticker.
What is Monero?
Monero is a privacy-based cryptocurrency project whose main goal is to provide better privacy than other blockchain ecosystems. This technology shields users information through stealth addresses and ring signatures.
Stealth address refers to the creation of a single address for a single transaction. No two addresses can be pinned in a single transaction. The coins received move to a completely different address making the whole process obscure to outside observers.
Ring signatures, on the other hand, refer to the combination of account keys with public keys thus creating a “ring” of multiple signatories. This means that a monitoring agent cannot link a signature to a specific account. Unlike cryptography (the mathematical method of securing crypto projects), the ring is not a new kid in the signature block. Its principles were explored and recorded in a 2001 research paper by the Weizmann Institute and MIT.
Cryptography has certainly won the hearts of many developers and blockchain fans, but the truth is, it is still a new tool with a handful of uses. Since Monero already uses tested ring signature technology, it has distinguished itself as an acceptable legitimate project.
Things to know before you start Monero trading
The market of the mind
Monero’s market is similar to other cryptocurrencies. If you want to buy it, Kraken, Polonix and Bitfinex are some of the exchanges to visit. PoloniX took it first, then Bitfinex and finally Kraken.
This virtual currency appears to be mostly pegged to dollars or to peer cryptos. Some pairs available include XMR / USD, XMR / BTC, XMR / EUR, XMR / XBT and many more. The trading volume and liquidity record of this currency is very good statistics.
One good thing about XMR is that anyone can take part in mining it in person or by joining a mining pool. Any computer with significantly better processing power can dig Monero blocks with some hiccups. ASICS (Application-Specified Integrated Circuit) which is currently mandatory for bitcoin mining.
Despite being a strong cryptocurrency network, it is not so special when it comes to volatility. Virtually all altcoins are highly volatile. This should not be a concern for any interested trader as this factor makes them profitable in the first place – you buy when prices are low and sell when they are on an upward trend.
In January 2015, the XMR was going at $ 0.25 then in May 2017 some jogging did $ 60 and it is currently bowling above the $ 300 mark. The Monero coin hit its ATH (all-time high) of $ 475 on January 7, before starting to fall to 300 300 with other cryptocurrencies. At the time of this writing, virtually all decentralized currency is in the process of price correction Bitcoin is tottering between the glorious ATH of $ 19,000 to 10-11k.
Functionality and acceptance
Thanks to its ability to offer reliable privacy, XMR is widely accepted and its coins can easily be exchanged for other currencies. Simply put, Monero can easily be traded for something else.
All bitcoins in the Bitcoin blockchain are recorded, and therefore, when an incident such as theft occurs, each currency involved will be prevented from operating indefinitely. With Monero, you cannot distinguish one currency from another. Therefore, no seller can reject any of them because it is associated with a bad event.
Monero blockchain is currently the most popular cryptocurrency with a significant number of followers. Like other blockchain projects, its future looks great because of government crackdowns. As an investor, you need to do your due diligence and research before trading in any cryptocurrency. Where possible, seek the help of financial experts to guide you in the right direction.