What Is Monero (XMR)?
If I had to answer “What is Monero” in fewer than five words, I’d say, “the most private cryptocurrency.” Unlike most existing blockchain cryptocurrencies, where transactions are openly verifiable and traceable by anyone, Monero (XMR) offers completely private, censorship-proof, untraceable, and opaque transactions.
Monero’s “CryptoNote” platform was designed to provide a solution to the problem of how to buy Monero and how to sell Monero without being traced. The platform enables users to hide all transaction data, including the sender’s address, the receiver’s address, and the amount transacted.
By default, each Monero transaction makes every detail of the transaction completely jumbled and unintelligible. Thanks to this, Monero will always be accepted without the risk of censorship.
Is There a Supply Limit to Monero?
While, like Bitcoin, there is a supply limit to Monero, it has the advantage of a “tailing emission.” The main Monero supply is about 18.1 to 18.4 million coins to be mined by May 2022.
After this, the main supply stops and the tailing supply kicks in at the rate of 0.6 XMR per two-minute block. The idea behind the tailing emission is to create a 0.87% yearly inflation around May 2022, so that miners will still have incentive after the currency is not mineable anymore.
How to Buy and Sell Monero on Exchanges
Even though Monero is among the top 10 cryptocurrencies, some of the top exchanges do not support it. People trying to figure out how to buy and sell Monero on exchanges often have to go through an extra step.
This extra step involves buying Monero with another cryptocurrency, rather than with fiat currency.
The first step is to get a Monero wallet, which is an account for you to send and store your Monero. Once your wallet is ready, you can buy Monero through Coinbase.
First, trade your dollars (or other fiat currency) for Bitcoin through Coinbase. You can use the Bitcoin to trade for Monero on the exchanges.
Some of the exchanges and their trading pairs) that support Monero are:
- Poloniex (XMR/LTC, XMR/XDN, XMR/BCN)
- Changelly (XMR/BTC)
- Bittrex (XMR/BTC)
- BTer (XMR/BTC)
- Coin-Swap (XMR/BTC)
- Melotic (XMR/BTC)
- CryptLocal (XMR/BTC)
- ShapeShift (XMR/BTC, XMR/Dash, XMR/Ripple, XMR/Nxt, XMR/Dogecoin)
Once you’re ready to exchange, select BTC from the “YOU HAVE” menu, and select XMR from the “YOU GET” menu. Enter the amount of BTC that you want to exchange for XMR. The application will automatically calculate your exchange rate and fee. Select “Next” and, in the space provided, enter your Monero wallet address. Select “Next,” confirm your details, and make the payment.
With a few minor changes on each exchange, these are the basic steps to follow to get Monero. If you have to buy Monero with a credit card, the process is similar.
How to Buy Monero with a Credit Card
Just as one cannot buy Monero with fiat currency, similarly, it’s difficult to buy Monero directly with a credit card. One has to first buy Bitcoin with the credit card through Coinbase or another exchange. Once the Bitcoin is ready, one trades it for Monero following the same steps as outlined above.
However, you must remember that, even though buying Bitcoin on Coinbase is pretty simple, you can buy only a small amount each time, and your card is charged for each transaction.
How to Buy Monero with PayPal
Unfortunately, one cannot buy Monero with PayPal. There was a time when PayPal supported digital currencies and allowed the purchase of Bitcoin through its payment platform. But now, all one can do is deposit money from the sale of Bitcoin into their PayPal accounts.
With Monero, PayPal can only be of use to deposit money. A Monero holder could sell their Monero for Bitcoin, send it to Coinbase, and then withdraw that money into PayPal for dollars or other fiat currency.
Buy Monero with Fiat Currency
There are many exchanges that allow one to directly buy Monero with fiat currency.
- Livecoin, the online exchange, supports wire transfers.
- Coincut, another online exchange, allows purchases of Monero via British pound (GBP) bank transfers.
- MoneroForCash and LocalMonero support local peer-to-peer purchases of Monero with cash.
- Kraken, a popular exchange, supports the purchase of Monero with euros and U.S. dollars.
- LiteBit, Orillia, and Anycoin Direct allow people to buy Monero with a single euro payments area (SEPA).
These options will allow you to avoid the Bitcoin transaction loop. Having said that, many of these options offer unacceptable spreads. For example, for €100.00, one can buy 14.86 XMR at AnyCoinDirect. But, when you sell them on the same exchange, one would get only €89.96. Given the huge discrepancy, it’s much better to buy Bitcoin with fiat currency and then buy XMR with Bitcoin.
Buy Monero at MyMonero.com
The simplest way to use Monero is on MyMonero.com. This Web-based interface allows one to send and receive Monero safely and securely—anywhere, any time.
MyMonero allows you to use Monero without running a full Monero node. But, because of the absence of the full node, it is extremely difficult for MyMonero to securely deliver its code to your browser. So there is a risk in using this interface for large amounts!
The best way to use MyMonero is to treat it like you would an online wallet and not store very large amounts in it.
To use this interface, you need to open a MyMonero account and get your 13-word private login key (PLK). The PLK can never be changed. If it is stolen or compromised, you have no option but to move your funds to a new account with a new private login key.
It is always advisable to back up your private login key by writing it down and storing it in multiple safe and secure places. (Source: “That was simple. Your Account has been created,” My Monero, last accessed December 20, 2017.)
Would you like your finances to be a public secret? I’m guessing no. And that’s why Monero is becoming popular.
Why is privacy so important?
Consider a situation in which you have to make a cryptocurrency transaction while traveling through part of a country with a violent crime rate. If people you transact with know how much money you have, it could pose a threat to your personal physical safety.
And let’s take a more plausible business situation. If a supplier knows how much money your business has, and is able to see which other suppliers you are dealing with, and how much you are paying those suppliers, it can severely affect your price negotiations.
Or how about this? You receive Bitcoin as payment for a product you sell (let’s say soft toys). Suppose Bitcoin was previously used in a criminal transaction. You could now be a suspect in a criminal case.
With Monero, issues like these are non-existent, as every transaction is completely private. In addition to privacy, Monero offers:
- A superior mining algorithm.
- An adaptive block size limit.
- A plan to be integrated with the invisible Internet project “12P Layer.”
- A high-quality development and research team consisting of 180 contributors.
Given all these advantages, it’s not surprising that Monero coin is among the top 10 altcoins in the cryptocurrency market.
But it does come with the risk of being compared to off-shore accounts and Swiss banks, and being seen as a coin that could support a lot of criminal activity around the globe. So, if ever a cryptocurrency carries a risk of being scrutinized or banned by governments, it’s this one. In other words, the silver lining comes with a cloud.