Monero (XMR) is one of the most popular and traded cryptocurrencies in the world. It provides unique features in terms of security and confidentiality that makes it stand out among other coins.
- What is Monero?
- Monero’s features
- How Monero works
- XMR Mining and storage
- Monero’s strengths and weaknesses
What is Monero
Monero is one of the most anonymous and protected cryptocurrencies based on the CryptoNote protocol. Its decentralized blockchain ecosystem has an open code and is built on innovative technologies that make Monero transactions almost untraceable and the coin itself very popular. It was initially launched in 2014 as a fork of another cryptocurrency, Bytecoin. Its name comes from Esperanto and simply means “Coin”. When first launched, this cryptocurrency was called BitMonero, which literally means “BitCoin”. Today Monero enters the list of Top-20 cryptocurrencies with the largest market capitalization. Its developers update Monero’s algorithms every 6 months to keep it protected from attacks and maintain the users’ confidentiality.
Monero is said to be the most confidential, secure, untraceable and autonomous cryptocurrencies on the market. Unlike most other cryptocurrencies, Monero doesn’t require other blockchain participants to verify XMR transactions. Monero users have full control over visibility of their operations. While all XMR transactions are hidden by default, the users have tools they can use to demonstrate the state of their accounts and keep their coins safe at the same time.
How Monero works
XMR transaction are hidden from tracking by technology called Ring Signature. It mixes up XMR transactions with each other making it impossible to trace individual transfers. Monero also hides the wallet’s balances using the Stealth Addresses technology. It generates random dynamic addresses that can’t be linked to specific individuals.
Monero users have two access keys that provide either limited or full access to the wallet. The View Key can be used to share the user’s transaction in a view-only mode, for example, for the audit and reporting purposes. The Spend Key grants full access to the Monero wallet and allows making XMR transactions without limitations.
XMR Mining and storage
Emission of XMR is not limited and coins can be mined using GPU or CPU of a computer. Both options can be beneficial depending on the utilized hardware. To start mining XMR, one will need to install the mining software and a wallet. Many miners prefer to join the mining pools to speed up the mining process and increase the outcome.
XMR coins can be stored in many virtual wallets and exchanges. The developers have also released an official Monero Wallet available for multiple platforms.
Monero’s strengths and weaknesses
Obvious strengths of Monero are:
- decentralization provided by the blockchain technology;
- complete confidentiality and security of transactions;
- unlimited number of coins;
- easy mining compared to other coins.
Confidentiality can also be considered the weak spot of this cryptocurrency since governments tend to ban cryptoactives they can’t track or control. There is a risk of Monero getting suspended from exchanged in China, India and several other countries.