What Is Monero (XMR) Currency?
Due to its relatively recent nature, a lot of people are asking, “What is Monero?” Or even more frequently, people ask, “What is XMR currency?” Luckily, the answer to both questions is actually the same. Monero is a comparatively new cryptocurrency, and XMR is its symbol.
Launched on April 14, 2014, the name derives from the Esperanto word for “coin“ or “currency.”
An extraordinarily anonymous cryptocurrency, the Monero coin is decentralized and extremely private. With a total supply of 18.4 million coins and a permanent fixed production of 0.3 per minute, it uses ring signatures and ring confidential transactions (RCT) to help provide privacy at a protocol level. (Source: “What to Know Before Trading Monero,” CoinDesk, Inc., May 28, 2017)
In this Monero wiki, we’ll go over some of the essential traits of this powerful cryptocurrency, and answer questions on its advantages and drawbacks.
Who Created Monero?
Although Monero was officially launched in April 2014, its history is somewhat older than that. In July 2012, Bytecoin was created as the first cryptocurrency to run on the application layer protocol known as CryptoNote.
However, serious concerns arose when it became apparent that over 80% of Bytecoin had been mined before its public release. In addition, the blockchain was then falsified to show a fair distribution.
The question of who created Monero is still something of a mystery. Seven developers decided to fork the blockchain relating to ByteCoin, and the new coins in the original chain were named Bitmonero.
These seven developers mostly chose to remain anonymous (David Latapie and Riccardo Spagni are the only two publicly identified).
Originally launched as Bitmonero, its name was later shortened simply to Monero in April 2014, to avoid any confusion with Bitcoin.
Monero Supply Limit: Is There a Cap for Monero?
Monero was created in response to the problems that plagued its immediate predecessor, Bytecoin, as well as other more famous cryptocurrencies, like Bitcoin. The Monero supply limit was therefore carefully capped at an initial total supply of 18.4 million coins.
A certain number of coins are “lost” each year, so the string upon which Monero is based allows coins to be mined at a rate of 0.3 a minute.
Monero vs. Bitcoin: Why Monero and Not Bitcoin
|Market Cap||5.87 Billion*||307.07 Billion*|
|Launch Date||April 18, 2014||January 3, 2009|
|Total Coins Available||~18,400,000||21,000,000|
|Average Block Time||~2 minutes||~10 minutes|
(*) – as of this writing
As you can see in the Monero vs. Bitcoin chart above, both currencies bring different, unique features to the table. Because it has a much more extensive history, and because its name is so well known, Bitcoin has the clear lead in terms of recognition and general adoption. In addition, because the XMR supply cap is smaller, there are theoretically more Bitcoins currently available.
On the other hand, as a newer coin, Monero has a lot to offer investors and traders that Bitcoin cannot. With an average block time five times faster than Bitcoin’s, and a fully anonymous privacy ranking, Monero is in a unique position to deliver a truly valuable alternative to fiat currency. And with a price still under $300.00, it remains a lot more accessible to everyday investors.
Monero Features: What Gives Monero an Advantage Over Other Cryptocurrencies?
Because privacy is at the very heart of the Monero project, it has developed into a uniquely powerful cryptocurrency, with a number of advantages over other competitors. Almost all cryptocurrencies bill themselves as secure and private, but not all of them actually are. These Monero features make it an alluring prospect for investors and everyday users.
Both Bitcoin and Ethereum, two enormously popular cryptocurrencies, use transparent blockchains. That means each transaction is public and can be traced by anyone around the world. For senders or receivers who do not wish their activity to be linked to their real-world identities, this presents a serious problem.
Monero operates on the basis of far more stringent cryptography. This is one of the greatest of all Monero advantages. The sending and receiving addresses are shielded, as are the transaction amounts. Perhaps even more importantly, this is a default setting and is “always on.” Other cryptocurrencies, like Zcash, rely on a selective transparency. The result is that Monero’s entire user network is safer and more anonymous.
Additionally, as Monero continues to build out features relating to its privacy, users will be even more protected. One such feature is IP address obfuscation by the Kovri project. It is currently under development and, when completed, will route and encrypt transactions through Invisible Internet Project (I2P) nodes.
Outside the technical features of Monero, another factor that makes it stand out is the way it is developed. As an open-source coin, it is available to all. Continuous improvements by its grassroots community of more than 240 developers and 30 core developers ensure continuous growth. Because it’s not owned by any specific corporation or country, it cannot be controlled, shut down, or regulated in any individual jurisdiction.
Another powerful incentive to use Monero to send money is the lack of multi-day holding periods. And, due to its powerful encryption technology, there is also no risk of fraudulent chargebacks, and the coin cannot be controlled by governments suffering from economic instability.
All of these advantages combine to make Monero a valuable cryptocurrency for more than just investors. It’s also an easy, safe, and anonymous way to move money around the world.
Although Monero has many benefits for users and investors, it still has a long way to go before it achieves its goal of being a globally used currency—and Monero limitations are always worth considering. One of the most important traits of Monero is its commitment to privacy. And it is probably one of the most private cryptocurrencies in existence. However, until the completion of the Kovri project mentioned above, it cannot be called perfect.
Other Monero drawbacks are related to its competitors as much as they are related to Monero itself. Because Bitcoin is so much more well known, it has been adopted into use by many more people. That makes Monero difficult to use, especially because it’s not easy for merchants to accept Monero in the first place. Numerous apps are in development to help solve this challenge (like PayBee).
Another concern for many in the Monero community is the relatively concentrated mining. Almost 35% of Monero mining is currently consumed by only four large pools. Although the largest of these four controls only 16% at the time of this writing, it is important to maintain as decentralized a mining process as possible.
Monero Potential: What’s in Store for Monero in Future Value?
The Monero potential is huge, which is why we believe that its future value will continue to grow. Since the beginning of the year, its price has climbed from $13.44 to almost $300.00. That represents a total growth of over 2,000% for investors. Although XMR future value is difficult to know for sure, we predict that a Monero value of $400.00 is not unrealistic in the next year.
Chart courtesy of TradingView.com
Monero’s commitment to privacy and security for its users is laudable. But more than that, it’s actually backed by the fundamental structure of the development team.
For example, Zcash is owned and developed privately. If that company comes under scrutiny or investigation by a government body, users cannot be assured that their information will remain uncompromised. The open-sourced, heavily decentralized nature of Monero acts as a bastion against this danger.
A number of recent hacks and government crackdowns in the cryptocurrency sphere demonstrate to users and investors the value of privacy and anonymity. Governments can make arbitrary decisions.
With its “always on” privacy settings and an average block time five times faster than Bitcoin, Monero is poised to become the breakout cryptocurrency for privacy-minded individuals in the future.