One of the core precepts of blockchain technology is to provide users with unshakable privacy. Bitcoin, as the first decentralized cryptocurrency, built on this premise to market itself to a wider audience that then needed a virtual currency free from government meddling.

Unfortunately, along the way, Bitcoin proved to be plagued with several weaknesses, including non-scalability and the mutable blockchain. All transactions and addresses are written on the blockchain, making it easy for anyone to connect the dots and reveal users’ private details based on their existing records. Some government and non-government agencies are already using blockchain analytics to read data on the Bitcoin platform.

Such flaws have led developers to seek alternative blockchain technologies with improved security and speed. One of these projects is Monero, usually represented by the XMR ticker.

What is Monero?

Monero is a privacy-oriented 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.

Stealth address refers to the creation of a single address for an individual transaction. You cannot pin two addresses to a single transaction. The received coins go to a totally different direction, which makes the whole process unclear to an outside observer.

Ring signing, on the other hand, refers to the combination of account keys with public keys, thus creating a “ring” of multiple signers. This means that a monitoring agent cannot link a signature to a particular account. Unlike cryptography (mathematical method of securing crypto projects), ring signing is not a new kid on the block. Its principles were explored and recorded in a 2001 article from the Weizmann Institute and MIT.

Crypto has certainly won the hearts of many developers and blockchain fans, but the truth is that it is still a fledgling tool with various uses. Since Monero uses proven Ring signature technology, it has distinguished itself as a legitimate project worth adopting.

Things to know before you start trading Monero

Monero Market

Monero’s market is similar to other cryptocurrencies. If you want to buy it, Kraken, Poloniex, and Bitfinex are some of the exchanges to visit. Poloniex was the first to adopt it followed by Bitfinex and lastly Kraken.

This virtual currency appears mostly pegged to the dollar or against other cryptocurrencies. Some of the available pairings include XMR / USD, XMR / BTC, XMR / EUR, XMR / XBT, and many more. The volume of operations and the liquidity of this currency register very good statistics.

One of the great things about XMR is that anyone can participate in mining, 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 opting for the ASICS (Application Specific Integrated Circuits) that are currently required for Bitcoin mining.

Price volatility

Despite being a formidable cryptocurrency network, it is not that special when it comes to volatility. Virtually all altcoins are extremely volatile. This shouldn’t worry any avid trader as this factor is what makes them profitable in the first place – you buy when prices are declining and sell when they are in an uptrend.

In January 2015, XMR was $ 0.25, then trotted a bit to $ 60 in May 2017 and is currently above the $ 300 mark. The Monero coin posted its ATH (all-time high) of $ 475 on January 7. before it started to fall alongside other cryptocurrencies to $ 300. At the time of writing, virtually all decentralized currencies are in price correction phase with Bitcoin reeling between $ 10-11k from its glorious ATH of $ 19,000.

Fungibility and adoption

Thanks to its ability to offer reliable privacy, XMR has been adopted by many people making their coins easily substitutable for other coins. In simple terms, Monero can be easily exchanged for something else.

All Bitcoins on the Bitcoin Blockchain are recorded and therefore when an incident such as theft occurs, all the coins involved will be prevented from trading, making them non-tradable. With monero, you cannot tell one currency from the other. Therefore, no seller can reject any of them for being associated with a serious incident.

Monero blockchain is currently one of the most popular cryptocurrencies with a significant number of followers. Like most other blockchain projects, its future looks great despite the impending crackdown from the government. As an investor, you should do your due diligence and research before trading any Cryptocurrency. Whenever possible, seek the help of financial experts to get you on the right track.