Monero made it onto the crypto scene by offering a previously unexplored area upon its release. The concept of complete anonymity was still theoretical when Monero was introduced on April 18, 2014. The project is based on an untraceable blockchain powered by XMR.
The Monero project was developed by a team of seven developers, of which only the identities of three are known – Francisco “ArticMine” Cabañas, David Latapie and Riccardo Spagni, who is the current lead developer. The others are identified only by aliases – Smooth, Binaryfate, Luigi1111 and NoodleDoodle. Although Monero is built on open-source technology, its selling point is the complete anonymity it offers. Its transactions cannot be traced, shielding holders and exchangers from the eyes of the curious public.
Why was Monero invented?
When Monero was developed, the gaping need for complete anonymity was what it sought to solve, and it has filled that gap to a large extent. At the time of Monero’s release, there was no digital currency that allowed for traceable transactions. Today, there are several other projects that have copied this feature.
Monero was designed to be a currency that would operate independently of controlling forces such as central banks and government regulators. One of the biggest criticisms of fiat currencies is that the basis for their creation and valuation lacks transparency. Monero today derives its value from market forces of demand and supply, as well as other factors in the global economy.
Outside of the above, Monero can also be used as follows:
- As a medium of exchange for the settlement of goods and services.
- On crypto marketplaces that enable trading of digital assets.
- Embedded in digital wallets with instant payments.
- Payment method in online casinos, read more at this site.
How does Monero work and what is the technology behind it?
The Monero ecosystem is powered by Nitrogen Fog software, which allows transactions to take place without traceability. Transactions on the network are routed through the Dandelion++, which propagates m. Each transaction on the network is enabled by a wallet, which is the primary storage method. Thus, when tokens are sent from one person to another, they only show up in the individual wallets.
Initiated transactions are processed by miners, who are responsible for the security and validation of all entries on the network. The protocol currently used is the Proof of Work (PoW) model, which also underlies the Bitcoin ecosystem. The innovative feature of the PoW mechanism is that mathematical puzzles must be solved before value is created or transferred.
Is Monero real money?
Monero is more than just real money. It has a complete ecosystem that accepts XMR as a means of recognizing and facilitating value. So XMR is real money because it allows for the storage, exchange, and transfer of value. Monero is also much more than that.
Currently, Monero functions like Bitcoin in terms of its use as an alternative payment method outside of fiat. However, given the speed at which the ecosystem is improving, we shouldn’t rule out the possibility of more uses popping up in the future.
Monero fees and costs
The average transaction on the Monero network costs just $0.0022. One factor that can affect transaction fees is network congestion, though this is rarely the case with Monero. One glaring feature of Monero is that prioritizing transactions can lead to higher transaction fees. While this is not forced on the transaction initiator, it is sometimes preferred depending on the urgency required. If there are many transactions in the queue, then those that pay higher fees are prioritized.
Buying Monero on crypto marketplaces also incurs a common fee for using debit or credit cards, which can range from 3% to 7%. Wire transfers, on the other hand, only cost between 0.2% and 0.5%.
What are the advantages of Monero?
Monero has quite a few things in common with the Bitcoin blockchain, mainly because of its use as a payment method. Others include:
- Fungibility – One of the most important features of cryptocurrency is fungibility. 1 XMR is always equivalent, which is due to the standardized measurement of value that comes with the token design.
- Decentralized – Monero has all transactions validated using a consensus mechanism, and this ensures that there is no need for a centralized body like central banks to manage it.
- Fast transactions – Another glaring advantage of blockchains is the use of automation. Transactions are verified based on authorization paths that require no manual effort, and this speeds up the pace of processing.
- Anonymity – Monero derives its high valuation from its leading position as a leading cryptocurrency that offers complete anonymity. The value of XMR on a Monero wallet cannot be viewed by checking Monero Explorer, as the transaction details are encrypted. It is useful for all gamblers who want more anonymity than for example the BTC casino on this page can offer.
Can Monero be used anonymously?
The obvious answer is yes. However, what is not often said is that many people use regulated exchanges. In this sense, if you buy a lot of XMR through these platforms, you can be documented for the transactions you make. This is where the invisibility ends.
For many cryptocurrencies, a user’s transactions show up using an explorer. For Monero, the explorer does not show the actual wallets used for transactions. The sender or receiver also cannot find out who the other party to the transaction is.
Therefore, for each transaction, the blockchain uses a hybrid of the sender’s and receiver’s wallet address, which cannot be deciphered in the Explorer report. For each transaction, instead of the wallet addresses, an ID is generated before it is passed for authorization, which can be validated by the miners before the verification is completed.
How secure is Monero?
Monero is secure because it uses cryptography in wallet identification and transaction authentication. However, cybercriminals managed to break into the network last year and corrupted the command line interface, exposing people who downloaded codes from the network to phishing scams. The good thing was that the hack was swiftly corrected.
Traders who have no need for code downloads were not affected. Again, it is important to point out that the breach did not target the blockchain itself, as this will be nearly impossible, but codes that interface with traders and e-commerce systems.
The main developer of the Monero ecosystem today is Riccardo Spagni, who worked with an initial team of 7 people to create XMR. Not much is known about 5 of the team members due to their preference for anonymity, but Spagni has remained in the spotlight over the years.
The most recent -update 0.16.0.0 was completed in Q2 2020. And there were 49 developers on the team who perfected 81,539 new lines of coding to speed up and secure the ecosystem. The result of the update is increased security and reduced bandwidth usage. In fact, faster transaction processing times are expected in the future.
Outside of the recognized official team, other efforts such as the Lightning Network must also be mentioned, read more in this article. Although the Lightning Network was not created specifically for the development of Monero, the optimization of the Proof of Works means that Monero is also a beneficiary of its research efforts. The most important aspect of this research effort is that micropayments can be batched and passed as single entries, significantly reducing transaction costs and avoiding long wait times on the network.
Currently, no leading financial institutions are openly involved in the development of Monero or its improvement. However, the growing number of cryptocurrency exchanges and platforms around the globe that support XMR trading provides a tremendous foundation for Monero’s continued use and profitability. At last count, there were more than 22,000 ways to invest in crypto trading worldwide.
Monero uses the proof-of-work algorithm, where miners must compete against themselves to solve a mathematical problem by trying to guess the required solution needed for a new block to be propagated in the ecosystem. The producer of the accepted solution is rewarded with XMR, currently 3.41 XMR. The way PoW works is that it prevents double spending or sneaking into the network without reaching consensus. Using completed transaction details as the basis for subsequent transactions means that gaining a fraudulent advantage on the network is highly unlikely.
The Monero Wallet is designed to be a repository for all Monero. There are several types of Monero Wallets:
- Monero GUI – desktop
- Monerujo – mobile wallet
- MyMonero – web-based wallet
- Guarda- web/mobile wallet
- Rand – mobile wallet
In addition, there are also hardware wallets. Trezor and Ledger Nano S are the best candidates for storing Monero via hardware device.
Is Monero worth investing in
Cryptocurrencies are known for their price volatility but the interest keeps increasing, read more. However, investment analysts will say “the higher the risk, the greater the reward.” Many experienced Monero traders will agree that the marketplace is known for its regular highs and lows. The highs provide a good opportunity for those who bought dXMR at a low price. The lows also provide good opportunities as the investor can buy these XMR when the price drops. Either way, the investor has both opportunities to profit. But as with all investments, there are no guaranteed profits.
Those who buy Monero would do well to use the right type of wallet for security reasons and perhaps to avoid losses. Using an incompatible wallet means losing the XMR. Even though different wallets appeal to different investors, it is always advisable to store the coins outside an exchange when you are not actively trading. If you are looking for a great return on your monero investment, it is advisable to explore the market and understand how crypto trading works.