Could Monero Be the Ideal Solution for Long-Term Trading?

In 2014, Monero, commonly referred to as XMR, was launched as a privacy-focused cryptocurrency with programming that evaluated the weaknesses of Bitcoin and focused on reducing these issues. In addition to its reputation as a secure and anonymous digital currency, it boasts the most physical characteristics of money out of all cryptocurrencies, making it one of the few forms of crypto to actually be a viable fungible asset. Even with this seemingly appealing nature, it isn’t talked about much within the crypto market, mainly due to the fact that many investors consider it a hybrid currency and the fear of the unknown seems to have taken a hold.

The Unique Approach of XMR

As a cryptocurrency aiming to be money, XMR has a lot of appealing traits due to its high fungibility and greater decentralization potential. In the simplest terms, this means that XMR may have set out to become a new type of crypto, but has instead attempted to transition into the fungible currency market. The most troubling fact is that because it isn’t as well-known or effectively branded as Bitcoin, this potential hasn’t been able to reach its fullest and this is a shame as the crypto itself has a lot to offer. Fortunately, and due to the functionality of Monero, it still performs as one of the most valuable cryptocurrencies, with a current rate of $158.99 (XMR to USD).

One of the biggest issues faced by Monero is that it has not yet achieved the global recognition that Bitcoin has, and because of this, it’s often overlooked as a reputable long-term investment opportunity. But, does that mean that it isn’t viable, especially when in the hands of an expert trader?

Monero’s Unique Features and Functions

The simple fact of the matter is that it’s Monero’s goal to be considered an actual, physical source of money. Even if every single type of cryptocurrency was compared, not a single one would come close to XMR’s ability to represent actual cash.

This isn’t just an opinion, it’s a fact, as Monero’s existing policy is one that leans towards the development of this currency based on fungibility. This is a mind-blowing concept for many within the crypto industry, as not even Bitcoin has attempted to enter the fungible money market, whereas the developers of XMR have been able to target a niche and run with the potential.

A Unique Approach That Appeals

Where Bitcoin went wrong was in its initial efforts to secure its position within the digital market. As it was coded to be traded across digital environments, it lacks the foundations that XMR has taken advantage of. The source code used to develop Bitcoin as an asset has been securely and carefully honed by the developers of XMR, allowing it to develop the traits associated with actual money, whilst remaining entirely incognito and anonymous. This is exactly the problem that Bitcoin suffers from since every transaction is visible to everyone.

A satoshi (which is a unit of value) can be permanently marked with data by using Ordinals NFTs, a mechanism that inscribes information on individual satoshis, which will permanently reduce the fungibility of the network and harm BTC’s ability to become money. In fact, this won’t just harm Bitcoin’s potential, it has taken an axe to it and completely blocked the possibility from coming to fruition.

Bitcoin runs the risk of satoshis being used for other things because it is a publicly accessible, transparent database. Because of this, each and every transaction that Bitcoin undergoes is available for viewing, making it the polar opposite of what private investors require to trade in anonymity.

A blockchain is designed for privacy, so Monero doesn’t have this issue. Three individual cryptographic techniques ensure Monero’s privacy and security. The way that this works can be quite challenging to understand, but in the simplest terms, regular blockchains rely on the public address of an individual whenever they send crypto. For stealth addresses, only the recipient’s private address is used. As soon as this transaction is complete, anyone with knowledge can see that the recipient received an amount.

This is how Bitcoin operates and why Monero is becoming a viable alternative amongst those that will give it a chance.

Funds in a stealth address are accessible only with the recipient’s private key – and there is no way around this. There can be no connection or tracking between stealth addresses generated from the same public address. Monero also mixes transactions of users with those of other users, so it’s hard to tell which transaction originated from which user, which acts as its own form of encryption that masks the trail.

For long-term investors, this anonymity and protection can be an appealing benefit, so much so that if the fear of the unknown is overcome, the value of XMR could undergo a rapid shift and the potential for it to become a market leader amongst cryptocurrencies will be far more probable.

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Disclaimer: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. No information or opinion contained on this site should be taken as a solicitation or offer to buy or sell any currency, equity or other financial instruments or services. Past performance is no indication or guarantee of future performance.

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