Monero, otherwise known as XMR, is an open-source cryptocurrency that provides high-end privacy in transactions. It was first developed in 2014 and is now easily accessible and available to all users across the globe. Due to its high level of privacy, Monero is recommended and used by many users dealing in online transactions, making it world’s 13th largest cryptocurrency by value while writing this.
What is Monero?
In Bitcoin and most other alternative coins, every user has his own wallet address which serves as a unique identification in the network. Bitcoins often termed as anonymous in general are not so by design. Rather it is ‘pseudo-anonymous’. The blocks, addresses, and transactions are traceable. However, one may not know the name of the address holder, but the transactions can be traced if there have been some transactions with the given address in past.
This hampers the privacy, as anyone in the network can easily access the details.
To deal with these privacy issues, Monero was developed. It provides high-end privacy. When a transaction is done through Monero, the recipient will not know the sender unless specified. Since wallet addresses remain unknown, backtracking is not possible. This forbids the prediction and calculation of someone’s wealth.
How does Monero work?
Like other cryptocurrencies, Monero is based on blockchain technology but with modifications. Its elementary feature is an opaque blockchain i.e. it hides the details of the sender, receiver and the amount of transaction. This makes it more private than the other cryptocurrencies.
Users can access Monero through their Monero wallet. This logs them onto the network, provides them with a uniquely identifiable ID and a profile or an account somewhat like a social media account. Through this wallet, they can buy Moneros using fiat currencies like Dollars, Pounds, Euros etc.
Each user on the Monero network has a publically accessible address to which the funds are not linked. This conceals one’s wealth from other users. When a transaction is made, the receiver profile is not linked with the public address of the sender. This obscures the details from any random user on the network and hence provides secrecy and confidentiality.
Similarly, for a user to know if any transactions were made where he was the recipient, the wallet scans the blockchain when launched. This ensures that the transactions made are untraceable and unlinkable. Monero does not allow the sender and the receiver to know the use of funds of the transaction by either, thus providing anonymity.
To combat the dominance of major players fluctuating the price, Monero was designed with ASIC Hardware such that large organizations will not be able to dominate the creation of new coins. This has added to its popularity.
The Future of Monero
Monero has a strong tech community and researchers backing it up, with its value achieving a 400% increase since the last year. It provides a safe and secure mode of exchange and is therefore highly popular among users of all kinds.
Since no software can be absolutely bug-free, Monero too comes up with bugs, few of which have already been dealt with by the developer team. With the advent of technology and the hour of need, it is likely that Monero may develop to more advanced versions providing greater privacy and control and therefore may experience a continuous growth in the users.