Because of macro trends like record-setting levels of inflation, growing interest rates from the Federal Reserve, and the continuing conflict in Ukraine, several cryptocurrencies and tokens have had ups and downs over the previous few weeks.
That said, at least one cryptocurrency project has defied the trend with a visible and consistent rise. When you zoom out and look at the three-month view for the privacy coin Monero (XMR), according to CoinMarketCap, you see that this asset has increased 87% since February 24, 2022. While the same website shows that Bitcoin is only up 18%, Ethereum is up 32% for that same period.
Why is Monero (XMR) surging and what is it?
In 2014, several developers banded together to build a blockchain-based project that emphasized privacy and anonymity. Ease of use and efficiency were the next priorities after anonymity and privacy. Monero is one of the first such cryptocoins, along with the Dash (DASH) project. There are several other privacy type currencies that have emerged since then – collectively called anonymity-enhanced cryptos (AECs) in crypto circles – including, Decred (DCR), Oasis (ROSE) and Zcash (ZEC).
The AEC class of digital assets differs from other cryptos because they use a variety of cryptography methods to obscure wallet addresses of recipients and senders of each AEC. In contrast, most other crypto transactions, including those involving BTC and ETH, can be seen by anybody who looks at the blockchains where trading takes place.
The Monero website claims that the project is focused on security, decentralization, and privacy. “This degree of privacy must be completely accessible to all of the users, whether they’re technologically sophisticated or have no clue how Monero works,” reads the website. A user must be able to trust Monero in a way that this person does not feel compelled to alter their spending habits for fear of others finding out.
Ironically, it’s these very characteristics that have prevented the U.S.-based crypto exchanges Coinbase and Gemini from adding XMR, which is presently available on just a few crypto exchanges including Binance and Kucoin. The prospect of regulatory blowback from listing such privacy coins and tokens has deterred many U.S. exchanges from putting them up for offering because AECs are frequently connected to unlawful behavior. Regardless, many law-abiding cryptocurrency users appreciate the concept of anonymity autonomy, which may be driving this increase in XMR as consumers purchase up the currency before it is possibly banned or outlawed
Should you buy Monero?
Over the past 24 hours, Monero has dropped about a fifth of a percent, trading at $253.34 on CoinMarketCap as of this writing. It is currently priced 48% below its all-time high of $483.58 set in May 2018.
Our picks are based on our experience, knowledge and research. These are simply personal viewpoints; they aren’t financial advice. Each investor should conduct their own study, investing only what they can lose comfortably. Given the current macro conditions, the increased desire for privacy in the crypto sector among users, and Monero’s low market cap of $4.6 billion, this project has a lot of potential – unless governments work together to ban it.