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Despite being in a bearish cycle this year, Monero's Privacy Coin (XMR) appears to be stronger on the long-term demand side.
According to MoneroBlocks.info, an explorer of XMR chains, the miners have already extracted 16,644,199 units against the total supply of 18.4 million XMR. The procurement is scheduled to continue until May 31, 2022, when the entire XMR supply will come into circulation. It would also signal the start of a new supply period, managed at a rate of 0.3 XMR per minute, which means that Monero as a token would never remain without supplies. Their whitepaper refers to this whole process as Tail Emission.
As explained, until the entry into force of the tail issue, the reward of the Monero block will continue to decline with each subsequent block drawn. The current block premium for drilling a Monero block is about 3.44 XMR. In 2022, the same compensation would eventually have reached the value of 0.6 XMR, after which it will remain the same.
A milestone for Monero?
The supporters of Monero believe that tail emissions make their blockchain more attractive to the mining community, since it would provide constant incentives even after reaching 100% circulation. In addition, they argue that the continued incentive will make the Monero blockchain safer in the long run.
Favoritism comes on the heels of the limitations of the incentive mechanism of Bitcoin. As of now, the world's leading decentralized blockchain emits salaries that are sufficiently superior to its miners to keep the network safe and functional. In addition, the blocks are small enough to handle a remuneration-enabled market, which means that transactions with higher commissions are included faster while those with lower commissions are forced out of the market.
However, Bitcoin's blocking premiums are scheduled to go down reasonably soon. By 2040, 99.8% of the total Bitcoin supply will be extracted and the remaining 0.2% will take the next 100 years to enter circulation. So, bitcoin will have to rely on on-chain transaction fees or dominant collateral contracts to maintain its security. At the same time, off-chain solutions would probably jeopardize bitcoin plans, because they would not require miners.
Even if off-chain solutions fail, for argumentative purposes, they could result in a secure blockchain but with higher transaction fees. Therefore, it could ultimately reduce the usefulness and the adoption of Bitcoin to a significant extent.
Monero, despite being a multimillion-dollar downward compared to the current position of Bitcoin, is still a project that can be relied on for network security. After May 2022, the industry will have a clear vision of how the currency performs the post-supply, perhaps even helping other developers to create solutions for their blockchain projects. An appropriately fungible currency, coupled with the tail issue to avoid chain security problems, and one that has existed long enough to be reasonably tested and proven – Monero could be a long-term solution.
Well, let's just hope he does.
