Today, there’s more and more people who are becoming interested in trading in cryptocurrency—a type of digital currency that’s secured by cryptographic technology. The growing interest is not unfounded; the speculative nature of trading in cryptocurrency appeals to investors who don’t mind enduring higher risks for likewise typically higher rewards. Another appealing trait of cryptocurrency is that its value is not easily influenced by external forces, such as those of international politics. Cryptocurrency can neither be printed nor seized, so it’s considered a pretty safe store of value.
But as the world of cryptocurrency will inevitably reveal to a new investor, not all forms of it are created equal. The once-dominant cryptocurrency options, like Bitcoin (BTC) and Ethereum (ETH), are now being challenged by newer players like Monero. Abbreviated as XMR, Monero has been able to amass a market capitalization of 5.3 billion USD since its founding in 2014. There are some pretty good reasons to choose Monero over other cryptocurrencies and to pursue a long-term trading journey with it.
Below are five distinguishing characteristics that make Monero an ideal cryptocurrency. Consider investing in this crypto and keeping it in a safe, open-source web environment like that of XMRWallet.
It’s a Highly Secure Cryptocurrency
One notable characteristic of Monero is its highly secure nature. This cryptocurrency was conceptualized with its traders’ privacy in mind, which is something that makes it stand out among its other crypto counterparts. The best demonstration of this characteristic is Monero’s ring signature and Ring Confidential Transactions (RingCT) systems. The ring signature system combines the digital signature of a Monero sender with the signatures of other users, therefore successfully concealing their identity. The RingCT technology, on the other hand, can hide the value of each transaction.
All in all, Monero’s system offers exceptional security to its traders. Trading in XMR proffers more protection of sensitive information—and thus more safety from interference—compared to other cryptocurrencies.
It’s Private and Untraceable
Another key characteristic of Monero is the anonymity it grants its traders. Though transaction receipts are public, they are also kept anonymous by virtue of Monero’s opaque blockchain. All addresses used by participants, as well as transaction amounts, are properly disguised by a one-time wallet address.
Thus, Monero is ideal for traders who want not only to invest or trade, but also want to keep a low profile. This shields them from unwanted scrutiny, like those instigated by cryptoanalytics firms with agendas of their own.
It’s a Truly Fungible Cryptocurrency
Monero is also a cryptocurrency that can be considered truly fungible, or mutually substituted without any difference. Traders can subscribe to the simple principle that one XMR coin is exactly interchangeable with another XMR coin. As a truly fungible cryptocurrency, that makes Monero different from fiat currencies that may have the same value, but have different markings to identify them (such as the serial numbers on individual US dollars).
This fungibility also grants a trader an extra layer of privacy. Given the lack of identifying markings like serial numbers, as well as Monero’s anonymization system, XMR is much harder to trace than BTC and ETH.
It Doesn’t Come with a Block Size Limit
Yet another distinguishing characteristic of Monero is its limitlessness. Unlike with other cryptocurrencies, there’s no pre-set total of XMR tokens currently in supply. In addition, Monero doesn’t possess a pre-set block size limit. That means that larger transactions can be facilitated in one second flat as compared to a cryptocurrency like Bitcoin.
It’s worth noting, however, that a recent safeguard implemented by Monero developers prevents users from mining rewards by spamming the blockchain. The system will take note of the total median size of the last hundred blocks and reduce the rewards if the succeeding block is larger than this total.
It’s the Subject of Cutting-Edge Crypto Technology
Lastly, some important technological developments have centered on Monero. One example is the recently launched Atomic Swap feature, which allows users to exchange Monero for Bitcoin without any assistance from a broker. Atomic Swap also protects details from Monero transactions from Bitcoin’s ledger, essentially extending the privacy of Monero transactions all throughout.
Monero is also highly scalable and capable of accommodating a surge of growth. That makes XMR one of the most exciting cryptocurrencies to watch out for in the future.
The Bottom Line on Monero
New investors to Monero should remember that all cryptocurrency investments come with risk. Monero is no exception, and it shouldn’t be thought of as a “magic bullet” type of investment. It’s best to weigh the pros and cons and to observe the market for XMR over time. And as with other investments, a trader should never put more money into Monero than they can afford.
But if you’re set on exploring crypto, Monero is one of the best choices you can pursue today. Its security, privacy, fungibility, and potential for rapid growth set it apart from other cryptocurrencies, therefore making it a smart crypto investment with lasting value.
