Monero (XMR) is a privacy-oriented decentralized cryptocurrency that has gained a significant following since the coin was released in 2013. Proponents of XMR saw Bitcoin’s traceability as a critical flaw, and as such, they came up with a currency that’s anonymous, private, and fungible.
A little less than a decade after the coin was launched, Monero has now amassed the third largest community of developers following Bitcoin and Ethereum. It has also experienced tremendous growth in value over the years, and each XMR unit can be sold between USD 100 and USD 500 depending on the market. There’s no wonder, then, that the coin is frequently included in the list of digital currencies that crypto investors should know about.
If you’re interested in trading or investing in Monero, then you probably have a few questions about the currency. Below are some of the most common questions that would-be investors have about the coin, how to use it, and how to maximize its privacy features.
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How Do You Start Trading in XMR?
It’s easy to get started on trading XMR. To do this, you’ll need to have a Monero wallet and a bit of extra cash. Using your allotted funds, buy XMR coins from an exchange and keep your new acquisition in your wallet. You can keep your coins in your wallet and wait for XMR’s value to grow over time, or you can use it to trade actively. Cryptocurrencies can be quite volatile, and you stand to earn a profit if you can use this to your advantage.
How Do You Mine Monero?
Unlike Bitcoin and other cryptocurrencies that require special hardware called an application-specific integrated circuit (ASIC) to mine, XMR can be mined using consumer-grade hardware like x86, x86-64, ARM and GPUs. The coin is designed to be ASIC-resistant to prevent the centralization of mining operations and to make the coin more accessible to the community. Once you have a mining rig for XMR, you need to download compatible software and configure it so that the tokens you mine can be sent directly to your wallet.
Is There a Limit to the Number of XMR Coins?
There are currently more than 18,000,000 XMR coins in circulation, but it doesn’t have a fixed supply. The rewards for new blocks will drop by the time 18.4 million XMR units are in circulation, but they’ll continue to be available at a fixed rate per block. This is expected to happen by May of 2022.
How Does Monero Ensure The Privacy of Its Users?
The information stored in blockchain systems is quite accessible, but this doesn’t mean that your transactions using your preferred coins are available to the public. XMR, in particular, makes use of 3 technologies to hide the details of its transactions to other parties: Ring Signatures, Stealth Addresses, and Ring CT. Ring Signatures add 10 more digital signatures prior to recording the transaction on the blockchain, Stealth Addresses generate single-use addresses for each transaction, and Ring CT hides how much each transaction is worth. Only the people with the right keys can check the accurate details of the XMR exchanges.
How Can Users Maximize Their XMR Coins?
There are different ways of maximizing the use of XMR coins. You can hold on to it for investment, trade actively and grow your stash, or even use it to pay for online transactions without sacrificing your personal information or identity. Using cryptocurrency can help you complete transactions that you don’t want others to trace back to you, and there are plenty of establishments and professionals that accept various types of crypto coins for their products and services.
Can Other People or Establishments Trace How I Use XMR?
XMR is designed for privacy and anonymity, and it obfuscates transaction details through the use of technology. It’s practically untraceable, so much so that the IRS has offered a generous bounty to contractors who can develop technologies for tracing Monero. As such, how you use your XMR coins will be completely up to you—it’s your asset, after all.
What Is Fungibility?
An item is said to be fungible if it can’t be distinguished from others like it. Think of gold coins and how the value of 1 coin is the same as the value of others with the same qualities. You can exchange your gold coin without experiencing a drop in value or determining which coin belongs to whom. Money is also fungible, but it can be traced back to its owner because it has a serial identifier. Monero coins are fungible like gold since they can be exchanged and used by just about anyone, no matter where the original coin came from or who used it in the past.
Are you ready to embark on your Monero journey? Make sure you have a good understanding of the cryptocurrency you want to acquire so you can say that it’s undoubtedly a perfect match for your asset portfolio.