Nicolas van Saberhagen
Monero (XMR) is an open-source digital currency launched in 2014 which focuses on three major things: privacy, decentralization, and scalability. Unlike many cryptocurrencies that are derivatives of Bitcoin, Monero is based on the CryptoNote protocol and it has different algorithmic differences relating to Blockchain obfuscation.
Monero was launched originally under the name BitMonero, which is a compound of Bit (as in Bitcoin) and Monero (literally meaning "coin" in Esperanto). Five days later, the community opted for the name to be shortened just to Monero. It was launched as the first fork of CryptoNote-based currency Bytecoin. In addition, the Monero developers found numerous incidents of poor quality code that were subsequently cleaned and reconstituted
Monero is powered strictly by Proof of Work, but specifically, it employs a mining algorithm that has the potential to be efficiently tasked to billions of existing devices (any modern x86 CPU). Monero uses the CryptoNight Proof of Work (PoW) algorithm, which is designed for use in ordinary CPUs. The smart mining feature allows transparent CPU mining on the user's computer
Monero is a secure, private, and untraceable cryptocurrency. It is open-source and accessible to all. With Monero, you are your own bank. Only you control and are responsible for your funds. Your accounts and transactions are kept private from prying eyes.
- Secure: Monero is a decentralized cryptocurrency known for its extreme difficulty to be hacked. Transactions are confirmed by distributed consensus, and then immutably recorded on the Blockchain. Third-parties do not need to be trusted to keep your Monero safe.
- Private: Monero uses ring signatures and rings confidential transactions to obfuscate the amounts, origins, and destinations of all transactions. Monero gains all the benefits of a decentralized cryptocurrency, without any of the standard privacy concessions.
- Untraceable: Sending and receiving addresses as well as transacted amounts are obfuscated by default. Transactions on the Monero Blockchain cannot be linked to a particular user or real-world identity.
- Fungible: Monero is fungible because it is private by default. In its current state, it is extremely unlikely that Monero will ever be blacklisted by exchanges or vendors due to its association in previous transactions.
All in all, its uses ring signatures, separate transaction units, and stealth addresses for its transactions to make it as secure as possible. Due to its different techniques to bring about an exceptional level of privacy, Monero is known to be the currently anonymity-oriented digital currency of choice.
- Forking is done regularly and routinely on Monero
- The most private coin available
- No pre-mine
- Big and enthusiast community - excellent support on Reddit, Slack, Telegram, and even StackExchange
- Difficult to use - requires using the command line
- No Graphic User Interface yet - developers and community primarily concentrate on optimizing its codebase to guarantee a high level of privacy which resulted in very little attention to cosmetic factors
- Not accepted at many locations
How to Buy:
The transaction fees involved in the buying of Monero will be lower if you choose to buy it directly on the Monero trading exchange like Kraken. But if you are interested in large purchases of the digital currency, it is highly recommended to use an exchange. As always, you will need to register on the exchange and fund the account. Some Exchanges will take a couple of business days in order to fund your account and actually get your identity verified with the exchange. So, please do take note of that.
The best option and fastest way of buying Monero are by first buying Bitcoin and then instantly swap your Bitcoin for Monero. This is especially appropriate if you are in a rush and want to take advantage of a dip in prices.
There are many exchanges that can help you do this successfully.
Monero's market operates like that of many other cryptocurrencies. Those interested in investing in the cryptocurrency can purchase it outright through exchanges including Poloniex, Bitfinex, and Kraken.
Carefully observe the market trends, the rise and fall of the prices before making any investments on any exchange because the goal of any investment is to make a profit. So you do well to observe this as well.
You may also be fortunate to meet those you are desperately in need of cash, so they might want to sell off their Monero coins, and this will be at a lower price. But be careful of scams.
Monero is stored on an account based on two distinct cryptographic keys: spend key and view key. The spend key is the only key required to authorize the transfer of funds out your account. The view key grants access to view (only, no spending) the balance and be handed over for the purposes of an audit. Both keys are 64 characters long. Your account also consists of a public address (shareable to receive Monero) and mnemonic seed (used to backup or restore account).
There are few storage options for your Monero:
- MyMonero: The simplest way to store Monero is via the online web-wallet MyMonero. It works on computer or mobile internet browser and doesn't require installation. It is important to note though that MyMonero's servers can see (but not spend) your Monero balance. It is owned and operated by Riccardo Spagni, one of Monero core team members.
- Full Node: If you like to run a full Monero client while also contributing to the strength of the network, consider a full Monero node. It also affords you the highest level of privacy while still allowing quick access to your funds. It also doesn't require a large amount of processing power on your unit, though you will need a few gigabytes worth of disk space.
- Paper Wallet: For absolute security, Monero on a paper wallet should be considered. It effectively moves the funds offline and into what is commonly referred to as "cold storage". In order to remove funds from the paper wallet and back online, you can either enter your mnemonic seed at MyMonero (requires 1 Monero fee) or by inputting the seed into your Monero client.
Please note that there will be an official GUI wallet for Monero still on beta stages of the development. Though there are no hardware wallets yet, the team at Ledger has indicated they are presently working on a Monero integration for their products.