Opinion: Monero is the best currency for privacy in the market right now

We live on a day when online privacy and, by extension, financial privacy, is a pulsating problem. Large companies are abusing data from private users. Attacks are still frequent, as are compromises related to sensitive information. This means that specific privacy coins seem destined to grow in popularity.

Since its release in April 2014, Monero (XMR) has become one of the leaders in the private coin industry. We will see why Monero is moving away from its main competitors, as well as the potential and potential for long-term use of money.

Why Privacy Coins?

When the layman think of cryptocurrency, they are probably thinking of a coin for privacy. A secure and untraceable digital currency. Free from the reach of governments, special interest groups, hackers and more.

While market leaders like Bitcoin, Ethereum and Litecoin have their advantages, it remains that they are totally transparent. There are many cases where this is an advantage, but it is not ideal for everyone. Traditional coins have all transactions stored on an immutable digital ledger, which is available to anyone. For some individuals or companies, the lack of privacy is a puzzle.

A public ledger also invites security risks. While wallets are still protected by a private decryption key, the publicly visible address offers hackers something to aim for. If someone has a wallet with a large amount of crypto, that address will always be under a certain degree of risk.

These concerns are the reason why privacy coins exist. Coins such as Monero, Dash and Zcash have integrated privacy measures designed to protect the identity of the sender and recipient. Transactions can not be traced in the same way as a Bitcoin or Ethereum transaction. In addition, many privacy coins also hide the wallet addresses, so as not to allow malicious individuals to attack.

The Benefits of Monero

Monero has established himself as a leader among private currencies, addressing all the reasons why people value privacy coins. Let's take a look at some of the significant advantages of Monero.

Privacy

Monero is genuinely untraceable, untraceable and non-traceable. In short: it is private. Privacy features are also always active. As a sender or receiver of Monero, you do not have to worry about the person on the other side of the transaction by taking due precautions. You are automatically protected by the way Monero works.

Each phase of a Monero transaction has a unique way of protecting the parties involved:

  • Transactions are signed using "Ring Signature". Each cryptographic transaction has an ID that verifies and signs on that transaction. With most coins, this is a way to track a transaction from the sender to the recipient. The Monero function uses a total of six IDs when confirming a transaction: five are fictitious IDs and one is the real one that signs it.
  • "Invisible addresses" hide portfolios and balances. Instead of a public address that is reused for each transaction, each time you send and receive Monero, a single address is generated randomly. Hide the identity of each part.
  • The "Secret circular transactions" (or RingCT) function hides the value of each transaction. The blockchain does not show the value of individual Monero transactions. Instead, a number of transactions are grouped together and the total amount of the transaction pool is visible and verifiable. But the amount of a single transaction is private at all times.

Some of Monero's privacy features can be made transparent, if necessary. Users have two private keys. A spending key allows you to access and negotiate funds. While a viewing key allows someone to view their transactions, such as when people need to allow access to reviewers.

Decentralization

The question that decides whether a coin sinks or swims is decentralized? With some private currencies, the stealthy nature of the network leads to significant concerns about how much control the founder (s) actually has.

Monero has so far escaped much of this FUD. The founding development team consists of seven members, five of which are known only under the pseudonym. While the founding member Riccardo "fluffypony" Spagni is at the forefront of the public view, as a whole, the project is the culmination of much more. With over 170 contributors to the code base on Github, it seems to be an active effort of the community behind the development of Monero. Unlike the effort of one or more individuals.

Lightweight Mining

Privacy aside, an advantage Monero attributes to coins like BTC and BCH is a much lower entry point to start mining. The encryption activity is increasingly controlled by large-scale operations, due to the burdensome hardware necessary to do so. This leads to a new concern for centralization. A company that holds most of the mining platforms potentially gives them control over the network.

Where Monero differs, it is their lightweight mining algorithm that does not need expensive mining chips to function. Almost anyone can extract Monero from a PC or laptop, which is impossible today for large coins. This reduces the chances of network abuse and opens Monero to a wide audience at the basic level.

Monero vs. Dash vs. ZCash

So, how does Monero stand out against the main competition in the sector?

Dash (DASH) has long been the closest competitor. At the time of writing this, the two sit on numbers 10 and 11 on CoinMarketCap, only several million aside on market capitalization. Monero's integrated privacy features make it an interesting option for those looking for a privacy-focused currency. Dash's privacy features are more than an optional extra, something that users can activate whenever they want. Dash seems to aim more for traditional adoption, raising doubts about their dedication to user privacy.

Dash has recently been the subject of important FUDs. In particular, an error in the early days of Dash caused the pre-extraction of a large amount of Dash – 2 million Dash, compared to the current total supply of just over 8 million. Many speculate that the founders of the coin contain these coins. This could make Dash's governance structure DAO (Decentralized Autonomous Organization) redundant.

The other currency that capitalizes on the private money market is Zcash (ZEC). Currently it is just outside the top 20 in market capitalization, about a third of the value of Monero and Dash. Zcash, based on the Bitcoin code base, uses zero knowledge tests to verify fully encrypted transactions.

Zcash is growing among private money enthusiasts for the privacy technology they bring to the table. But they also have questions about decentralization, which offer some concern. For a private currency, decentralization is vital. As a new project, Zcash is managed and developed by the Zcash Company, attracting a certain degree of trepidation. Furthermore, the Zcash extraction is becoming increasingly dominated by heavy commercial miners. Commercial mining offers another threat to decentralization. Because Zcash grows, this is something that you may need to address.

The Future of Monero

There is no doubt that Monero is leading the class right now. Dash offers great performances and sees increase mainstream adoption . But some important red flags are a concern. Zcash seems to have some initial problems to overcome, being in an earlier stage of development.

Monero may never threaten Bitcoin as the number one coin. Many need the transparency of regular cryptocurrencies. And while Monero's transactions are fast and cheap compared to Bitcoin, some question the possibility of scaling with heavier use, because the built-in privacy features lead to larger transactions than many coins.

In the end, the main threat to Monero is not from other currencies, but from external powers. Because of its robust privacy layer, Monero is seen by many as a criminal activity that allows. This led to the rejection from some exchanges, concerned about the potential liability of Monero users who conduct illegal activities.

It appears to be a roadblock for private currencies in general. One that will persist until the cryptography is still a dark gray area. But the private coin sector will always have strong defenders, and at this moment Monero offers everything that a private currency enthusiast seeks.

Andrew is a writer and digital marketer from New Zealand, now based in Southeast Asia. Along with his work in many areas of e-commerce space, Andrew has a strong interest in cryptocurrency, in particular altcoin projects and focused on the adoption of traditional cryptography

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