The cryptocurrency is one of the most talked about nowadays, but in front of the big references -currently, Bitcoin and Ethereum- there is a large group of tokens and altcoins, alternative cryptocurrencies among which lately we hear prominently: Monero (XMR).
This cryptocurrency was born in April 2014 with one purpose: to provide an alternative absolutely focused on privacy and also not based (like many others) on the bitcoin code. That has made it an increasingly attractive alternative in various fields, but especially in a disturbing one: cybercrime according to government researches.
Before talking about Monero’s features, we should mention; you can buy XMR – Monero from Binance Exchange.
The Most Private Cryptocurrency
We’re seeing it in those botnets that have been discovered in recent months that are responsible for mining Monero without users knowing about it. Not at least unless they keep an eye on the resource consumption of their processors.
But why Monero and not any other cryptocurrency? The reason is simple: Monero is characterized by untraceable payments and unlinked transactions.
What does it mean that a payment cannot be tracked? Well, for every transaction that reaches a user, all possible senders are equiprobable. Similarly, the unlinking of these transactions means that if two outgoing transactions are analyzed, it is impossible to prove that they were sent by the same person.
The official announcement of the appearance of Monero detailed the basis of this cryptocurrency, which instead of being derived from the well-known bitcoin took as a reference the CryptoNote protocol (PDF) and the Bytecoin cryptocurrency (BCN), precisely highlighted by these properties of zero traceability and privacy.
The disadvantage of bitcoin in this area is obvious: all transactions between network members are public, so many of them can be traced and their unique origin and destination identified.
Security by Obscurity
In the case of Monero, the funds we receive or generate are not in the digital wallet address we give to other users: instead every time we receive a payment those XMRs end up in an address unlinked to everything and generated with random numbers.
If we decide to spend the funds at that unique address, that amount will be split or broken down into different parts and the components will be indistinguishable from outflows of identical amounts on the blockchain.
Signatures
In the normal signature (top) there is one participant, allowing that transaction to be fully “mapped”. A signature ring (bottom) hides the identities, and only allows to prove that the signer actually belongs to that group of network users.
In these transactions, use is also made of the signature ring, which proves that the signatory belongs to the group but does not allow “mapping” and identifying the signer of the transaction by validating it.
These techniques propose the Security by Obscurity/Obfuscation model, which “hides” both the amounts and the origins and destination of the transactions, even though all of them are recorded in the blockchain of this platform.
As in other cases, however, this blockchain proposes a decentralized cryptocurrency in which these transactions are confirmed through a distributed consensus that, we insist, is recorded in the blockchain.
Unlike other implementations of the blockchain, that public information does not make it possible to identify the participants of the transaction or the amount of the transaction.
Advantages of XMR Monero
The privacy and anonymity provided by Monero have made this cryptocurrency one of the most interesting for those who are dedicated to monetizing their efforts in the field of cybercrime.
Monero’s price skyrocketed in mid-2016 with its adoption by AlphaBay. Its growth in 2017, like that of many other cryptocurrencies, has been spectacular.
In fact Monero gained popularity and quotation in 2016 thanks to its adoption by AlphaBay, that black market for goods of all kinds that was eventually shut down in July 2017 by law enforcement.
Its use by other cyber-attackers seems to be on the rise, as evidenced by the botnets discovered that use the resources of millions of PCs, laptops, and servers to mine Monero without the users of those machines realizing it.
The advantages are obvious, but they are also obvious for those who want to protect their privacy and the anonymity of their transactions (totally legal) for the simple reason of not feeling watched.
While with bitcoin you can always know how much money is in a digital wallet, and then try to trace the identity of its owner, with Monero it is almost impossible: not revealing how much we pay or receive to whom or from whom can be an important value in numerous scenarios, not only among end-users but also in companies (although here suspicions are inevitable).
Monero, of course, has its downsides. In discussions such as this one on Reddit in which several users of this cryptocurrency participated, they cited the high transaction fees, the lack of a graphical interface (the developers are working on it) to facilitate the management of the currency or the fact that it is quite complex to check the balance of our XMR in our digital wallet, something quite simple with alternatives such as bitcoin thanks to blockchain.info or Ether with myetherwallet.com.
The absence of a mobile wallet -which makes it difficult to operate with XMR from our smartphones-, the large size of transactions and, of course, its limited use (especially in some regions of the planet, such as South America or Asia) are some additional difficulties for the future of a cryptocurrency that, of course, has remarkable strengths.
Conclusion: Is Monero a Good Investment?
According to Wallet Investor, yes. The long-term earning potential is +56.78% in one year. And the Monero (XMR ) future price expected to be 885.974 USD by 2026.
