One of the core precepts of the blockchain technology is to provide users with unwavering privacy. Bitcoin as the first ever decentralized cryptocurrency relied on this premise to market itself to the wider audience that was then in need of a virtual currency that is free from government meddling.
Unfortunately, along the way, Bitcoin proved to be rife with several weaknesses including non-scalability and mutable blockchain. All the transactions and addresses are written on the blockchain thus making it easier for anyone to connect the dots and unveil users’ private details based on their existing records. Some government and non-government agencies are already using blockchain analytics to read data on Bitcoin platform.
Such flaws have led to developers looking into alternative blockchain technologies with improved security and speed. One of these projects is Monero, usually represented by XMR ticker.
What is Monero?
Monero is a privacy-oriented cryptocurrency project whose main aim is to provide better privacy than other blockchain ecosystems. This technology shield’s users’ information through stealth addresses and Ring signatures.
Stealth address refers to the creation of a single address for a solo transaction. No two addresses can be pinned to a single transaction. The coins received go into a totally different address making the entire process unclear to an external observer.
Ring signature, on the other hand, refers to mixing of account keys with public keys thus creating a “ring” of multiple signatories. This means a monitoring agent cannot link a signature to a particular account. Unlike cryptography (mathematical method of securing crypto projects), ring signature is not a new kid on the block. Its principles were explored and recorded in a 2001 paper by The Weizmann Institute and MIT.
Cryptography has certainly won the hearts of many developers and blockchain aficionados, but the truth is, it’s still a nascent tool with a handful uses. Since Monero uses the already tested Ring signature technology, it has set itself apart as a legitimate project worth adopting.
Things to know before you start trading Monero
Monero’s market is similar to that of other cryptocurrencies. If you wish to purchase it then Kraken, Poloniex, and Bitfinex are a few of the exchanges to visit. Poloniex was the first to adopt it followed by Bitfinex and lastly Kraken.
This virtual currency mostly appears pegged to the dollar or against fellow cryptos. Some of the available pairings include bitcoin loan XMR/USD, XMR/BTC, XMR/EUR, XMR/XBT and many more. This currency’s trading volume and liquidity record very good stats.
One of the good things about XMR is that anyone can take part in mining it either as an individual or by joining a mining pool. Any computer with significantly good processing power can mine Monero blocks with a few hiccups. Don’t bother going for the ASICS (application-specific integrated circuits) which are currently mandatory for Bitcoin mining.