6 Reasons Why Monero Remains A Great Investment For The Future
There will be a real need for a private, secure, and untraceable cryptocurrency in the future.
Monero is an open-source cryptocurrency focused on privacy and decentralization that was launched in April 2014 under the name BitMonero. Its name was then quickly shortened to Monero.
Monero is the result of a fork of the Bytecoin cryptocurrency that is based on the CryptoNote algorithm. The fork initially consisted of introducing significant differences on this last algorithm before Monero’s evolutions made significant changes.
Now, the Blockchain Monero adds a level of obfuscation with the mining of new tokens, the XMR, reduced. So much for Monero’s quick overview. While 99 percent of cryptocurrencies are destined to see their value move towards zero in the future, cryptocurrencies providing solutions to real user problems will have a high probability of persistence and long-term success.
The need for a truly confidential cryptocurrency is very real. In this field, Monero is an emblematic leader and there are 6 main reasons why Monero remains a great investment for the future. Here they are.
1. A Private, Secure, and Untraceable Cryptocurrency will Emerge
It is November 13, 2019, and there are 4800 cryptocurrencies listed on the reference site CoinMarketCap. It seems obvious that a large number of cryptocurrencies will not be able to survive over time. Indeed, many cryptocurrencies do not bring any real added value to their users because they are only forks of other cryptocurrencies.
Recently, Ripple’s CEO again stated that 99 percent of cryptocurrencies will go to zero in the future. I totally agree with him. Only cryptocurrencies that address real user problems will be able to survive in the long term. The need for a private, secure, and untraceable cryptocurrency is very real.
A private, secure and untraceable crypto currency will therefore emerge in the future.
As the emblematic leader in this field, Monero is well-positioned to survive when the cryptocurrency market will be purged of cryptocurrencies with no real utility.
Private by design, Monero also has the enormous advantage of being fungible. Thus, like the US dollar or other fiat currencies, 1 XMR is truly equal to 1 XMR.
This is not the case with Bitcoin, where each BTC comes with a complete history of the transactions that have led it from address to address and therefore from owner to owner. The need for a cryptocurrency such as Monero in the future is therefore very real.
2. Monero is Easy to Mine
Like Bitcoin, Monero’s consensus algorithm is based on Proof-of-Work (PoW). However, the algorithm for mining new XMR was designed from a completely different perspective than that of Bitcoin.
Bitcoin mining requires dedicated equipment, the famous ASICs, which must be ever more powerful and then consume ever more electricity. In addition, the investment to mine Bitcoins is always more expensive. Thus, it is now impossible for an individual to mine Bitcoins with a simple personal computer.
All this leads to an increasing concentration of Blockchain Bitcoin miners in countries with the lowest electricity costs.
In contrast, Monero’s mining algorithm has been specifically designed so that ASICs do not have too great an advantage over personal computers owned by the general public as part of XMR mining.
By facilitating mining on its Blockchain, with limited power consumption, Monero hopes to encourage the participation of new users in its network. Indeed, with a personal computer, anyone can become a node which can eventually increase the number of XMR miners in a very significant way.
3. Monero is One Step Ahead of Zcash or Dash
I have just explained to you that a private, secure, and untraceable cryptocurrency will necessarily emerge in the future because the need for users in this field is very real.
Logically, Monero is not alone in this field of highly confidential cryptocurrencies. Currently, Dash and Zcash are its most serious competitors. Nevertheless, these two cryptocurrencies seem to be lagging behind from a technological point of view because they cannot offer their users transactions that are totally untraceable like Monero.
To fully understand how Monero is currently superior, we need to take a look at its technology.
Ring Confidential Transactions at the Heart of Monero’s Power
On the Monero Blockchain, the transactions carried out are totally private, which means that the addresses of the senders and recipients are not public. In addition, the amount of transactions made remains private when they are entered in the general ledger of accounts. In fact, the content of the various Monero wallets is also private.
In order to guarantee this level of confidentiality, Monero implements a method called Ring Confidential Transactions (RCT) which is applied to all transactions since September 2017. This is a major evolution of the “Ring signatures”. Monero, therefore, has a huge advantage for its users since they can hide what they have in XMR tokens.
The Monero Blockchain guarantees a high level of confidentiality thanks to the following 3 aspects:
- The “Ring signatures” will allow a sender to hide his address during a transaction on the Monero Blockchain.
- The concept of stealth addresses allows you to hide the address of the recipient of a transaction.
- The Ring Confidential Transactions mechanism is responsible for hiding the amount of a transaction executed on the Monero network.
The addition of these 3 functionalities allows Monero to provide users with a totally opaque Blockchain.
While Bitcoin is often described as a transparent and traceable Blockchain, the Monero cryptocurrency is referred to as a private and untraceable Blockchain.
4. Monero was Really Designed to be a Medium of Exchange
Bitcoin was created to be a medium of exchange and a store of value. As time goes by, it seems that Bitcoin will become more and more established as a store of value. The number of Bitcoins is limited to 21 million and the latest news is that nearly 4 million Bitcoins have been permanently lost.
The next Bitcoin Halving scheduled for May 2020 will make the creation of new Bitcoins even more rare. Its price should skyrocket. Ultimately, in 2140, there will no longer be any reward offered to miners validating a block of transactions. It is possible that the already high transaction fees of Bitcoin will then increase more at that time if the volume of transactions has not reached a sufficient threshold.
Aware of some of Bitcoin’s current limitations in this regard, including a maximum number of validatable transactions per second limited to 7, Monero has adopted a different approach.
Monero’s transaction blocks are produced on average every 2 minutes compared to 10 minutes for Bitcoin.
While the block size on the Bitcoin Blockchain is limited, Monero’s designers have chosen to implement an automatic block size adaptative mechanism.
This means that the Monero Blockchain automatically adapts when the volume of transactions to be processed increases.
As a result, Monero can process many more transactions per second than Bitcoin Blockchain while maintaining low transaction fees. These features make Monero an excellent medium of exchange and this is precisely what the cryptocurrency aims to do rather than simply being a store of value.
5. Monero Benefits from the Strong Support of its Community
Since its launch, Monero has always received very strong support from its community. The project immediately succeeded in bringing together a large number of users.
The members of the Monero community are very active, which is essential to guarantee a sustainable future for a cryptocurrency.
Beginners’ questions are always welcome, which helps to popularize Monero. In addition, there is no organization behind the financing of Monero’s development.
It is a risk in a sense but also a great opportunity to allow the community to make its own choices for Monero’s future. Contributors work in their free time or live on donations received through the Forum Funding System set up by Monero Blockchain.
6. A Very Large Development Team is Working on Monero
Monero is a fully open-source cryptocurrency that, like Bitcoin, belongs entirely to its community. About 350 people have made contributions to the project since Monero was launched in 2014.
While it is 2019, nearly 200 developers are still active on the project. In the cryptocurrency world, this is simply one of the largest development teams for an open source project.
Having a very large development team to work on Monero gives the project a solid foundation. This ensures that the cryptocurrency will continue to evolve at a sustained pace. This is a crucial point in a technological field such as cryptocurrencies where everything is evolving very quickly.
Although Monero does not have a roadmap with dated milestones, the main objectives pursued by the cryptocurrency are well displayed in its roadmap and the publication of evolutions is done at a sustained pace.
The world of cryptocurrencies is constantly expanding. However, the vast majority of cryptocurrencies will not survive over time. As an investor, it is therefore essential to do your own research to find cryptocurrencies that address real user problems.
In addition, it is necessary to carefully analyze the sector in which a cryptocurrency is launched in order to validate that it will be able to take the lead in order to make a lasting impact. Indeed, it is obvious that users will not need 10 secure and untraceable cryptocurrencies in the future.
If a private, secure, fungible, and untraceable cryptocurrency convinces users on a massive scale, it will totally eclipse its competitors. And that’s exactly what Monero wants to be. Considering the 6 reasons detailed in this article, I believe Monero is capable of making a lasting impact in this field and that is why I consider this cryptocurrency to remain a very good investment for the future.