Privacy Coins - All about Monero

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I have been wanting to make this kind of publications for a long time, I have not seen anything like this in the community yet, since, most users are focusing on the new era of Decentralized Finance or DeFi, but they leave aside how elementary it is to know this kind of information about Cryptocurrencies, let's remember that there are many new users looking for some guide or instruction to learn much more about this world, so based on this, why not take advantage of the occasion.

So, to start with this type of essential publications on the Blockchain and Cryptocurrencies, I have chosen a very interesting topic such as "Privacy Coins", in this sense, I intend to explain one of the most famous coins with respect to the privacy it provides in its transactions, it has been in the markets for quite some time and at the time was among the top of major coins with respect to market capitalization, rivaling other projects in the industry with enough experience and that are still in the entire ecosystem. This coin is nothing more and nothing less than "Monero (XMR)".

Fundamental Analysis of Monero (XMR)

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Its beginnings as a project


The beginnings of the creation of Monero were really simple, starting with the fact that it was a user on the Bitcointalk platform who started its official history, this user is called "thankful_for_today". This person created on April 9, 2014 a thread where he announced and published about the creation of "BitMonero", which was composed by Bit, making direct reference to (Bitcoin) and Monero from (Currency in Esperanto). In addition to this, the currency was a Hard Fork of the so-called "Bytecoin" with some improvements, however, some time later the community that started supporting the project at that time did not like the idea very much and among the changes was that the currency was definitely called "Monero", starting again its history from this event.

Description of Monero (XMR)



Monero is an open source currency created in 2014, specifically in April. It is characterized for being one of the cryptocurrencies that has the highest level in terms of privacy and security of its transactions, together with the decentralization that makes it a very healthy project in terms of the developments and technology on which it is based. This level has been achieved thanks to the great technological advances it has achieved in Blockchain technology and cryptography itself. The multiplatform support it has is impressive, since, its software can even be established in systems such as: Windows, macOS, GNU/Linux, Android and BSD.

The Fundamental Pillars of Monero



The pillars of "Monero" are the foundations on which the project works, its approach is what makes this project successful and offers a wide range of features that make up its entire ecosystem. These fundamental pillars are as follows:

  • Privacy: privacy is its main strength, the protection of every transaction and the anonymity of those who use the cryptocurrency is the most important thing.
  • Security: Security is the second most important aspect of Monero, since its main objective is not only privacy and the protection of its users' money, but also the protection of the entire ecosystem that makes it possible to comply with them.
  • Decentralization: Monero is a unique currency of its kind, it does not have a central leader, this is because it is managed 100% by its community.

Essential features of the Monero growth


Among the most outstanding features of the project, there are many technological advances related to the highest level of privacy and security in cryptocurrencies, which led to the creation of several unique algorithms that make "Monero", this at the forefront and at the highest level of security and privacy in their transactions. In that sense, in this section I intend to detail the main features of this great project in the crypto ecosystem:

  • The focus of its privacy began with an algorithm called "CryptoNight", followed by a concealment algorithm called "Ring Signatures" which, mixes the address of the issuer with another group of addresses that make the transaction practically untraceable and finally an algorithm that largely makes each transaction and its balances confidential, this is called "Ring Confidential Transaction".
  • Its "Multiplatform" capability and its easy implementation in each of the most used systems in the world, made its adoption increase exponentially in 2017, which took the project to the main tops based on market capitalization and of course its usefulness based on privacy and security.
  • "Change.org" had a lot to do in the growth of the platform and the project in general, since, through this funds were obtained (Funded), for the development to continue and the network to follow its path to success, turning the project into one of the largest currencies in the Blockchain ecosystem.
  • Fungibility" is another of the characteristics that makes Monero so special, since it allows each Monero to be interchangeable for another coin that has practically the same properties. This makes it impossible to know if the transaction was made to a specific person, thus increasing the level of privacy and anonymity to very high levels.
  • An even more advanced algorithm integrated into the project is "Bulletproof", which has as its main objective to hide absolutely all the addresses of a transaction, in addition, it works much more efficiently in size and speed than the so-called "Ring Confidential Transaction".
  • Another of the most outstanding features of Monero has to do with "Stealth Address", which is mainly concerned with maintaining the privacy and security of the receiver.

Monero mining and issuance

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Monero mining started with the successful proof-of-work (PoW) based consensus algorithm, called CryptoNight, however, currently "Monero" uses another more advanced algorithm also with the same proof-of-work (PoW) algorithm, this is called "RandomX", which does not base its mining activity on ASIC equipment, but empowers and provides great opportunity for CPUs to mine under a virtual mining scheme. This provides better access to the currency and to the essential Monero platform, because miners can have access to less expensive equipment to support the network and collaborate with the project.


Its Governance and High Decentralization

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Its governance must be highlighted because, as I mentioned before, it is a 100% decentralized project, controlled solely and exclusively by its community, which bases its decisions in a meritocratic and communitarian way. Neither the team of developers has the power to make decisions on its own, no one is anyone's boss, decisions are simply made together for the good of the project and are executed according to its growth. Something that makes Monero very special.


Scalability, speed and cost of Transactions

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Another very important point is the scalability of the core ecosystem of this project. Its technical capacity and technological expansion, is very much involved with the following aspects that I will describe below:

  • This Blockchain has the capacity to execute transactions in an average of 2 minutes.
  • The number of validations required to add a block to the network is 18.
  • To verify a transaction, it can take from 10 to 20 minutes approximately.
  • The cost of Monero transactions ranges around $0.01 and $0.05, which is really low and a very good charge for a transaction.


How to create a Monero wallet?

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To create a Monero wallet, just follow these steps:


  • Step 1: We must go to the official website of Monero, where we will click on the "Downloads" option. Once we are in the next screen, we will look for the first option called "GUI Wallet" and click on it. Finally, when we click on this option, we will go down the screen a little bit and we will find the download links depending on the device we have. In my case I will use the "Windows 64 bits" option. And we proceed to download.

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Screenshot of getmonero

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Screenshot of getmonero

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Screenshot of getmonero

  • Step 2: Once the file is downloaded, click on install. When we finish this action, we click on "Next", then it will ask us to accept the terms of service, we accept them and we go ahead, we confirm all the following and we wait for it to be installed in our computer.

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Screenshot of getmonero

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Screenshot of getmonero

  • Step 3: Once the file is downloaded, we look for it in nutro desktop, double click on it and start. The first thing to do is to choose our language, in my case I chose Spanish because it is my native language. After this we select the "Simple Mode" which is the one we need to send and receive normally in our wallet, additionally it will ask us to accept that, if we agree to use a third party server, where we must select yes and press next, then select to definitely create our wallet.

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Screenshot of getmonero

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Screenshot of getmonero

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Screenshot of getmonero

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Screenshot of getmonero

  • Step 4: This step is very important, in it we must select the name that our wallet will have. Then we will get our seed phrase and the height of restoration of the wallet, which we must save very well in case we lose access to our wallet or computer. Once you save them, click on next, create a secure password, click on next and finally click on "Create Wallet". You will be asked to enter the password you just created and that's it, you will have access to your wallet to send and/or receive your funds in Monero.

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Screenshot of getmonero

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Screenshot of getmonero

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Screenshot of getmonero

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Screenshot of getmonero


Why I chose Monero as a privacy currency.

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I chose this privacy currency because I like the fact that it is 100% decentralized, being managed only by its community without having a central boss that makes the major decisions, which is excellent because everyone together has the right and the power to make the best decisions in order for the project to grow. In addition to this, the incredible technology that is behind Monero, calls my attention, its privacy is very high level, as well as its security, surpassing by far currencies such as Dash, which are basically based on the speed of their transactions.

Advantages

  • Transactions are never related to any Monero user, which is excellent if you want to have a level of anonymity in each transaction.
  • Its development is of the highest level that I have seen in one of the privacy currencies, which speaks of the serious work that the developers have done for the project.
  • Even when the total supply of monero is exhausted, miners will still receive their rewards for supporting the network by receiving 0.6 XMR.
  • Its growth in market capitalization is remarkable and exponential, being a currency that is 100% driven by its community.
  • The Blockchain is fully scalable

Disadvantages

  • Even when Monero updates were changed so that it is not centralized in mining through ASIC equipment, there are farms that still mine it, however, its activity in recent times has been declining.
  • The high level of privacy that Monero enjoys, allows many users to carry out countless money laundering crimes and secret payments for totally illicit things and situations.
  • They should focus on creating new applications that will grow their entire community, always emphasizing that their main goal is the security and privacy of their users.


Conclusion

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Privacy Coins in the cryptocurrency ecosystem play a very important role linked to the anonymity that each person would like to have with respect to their funds; and although we know that many times they are often used for criminal purposes, it is certainly very interesting and I could even say necessary, since it allows us to have the possibility to choose whether we want our transactions to be shown or not in a certain Blockchain.

Atte. @Lenonmc21



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