Monero (XMR) Is the King of Stealth Cryptocurrencies and Significantly Undervalued

September 11, 2019 / by Zachary Mashiach

There are numerous cryptocurrencies that are copycats, scams, or fundamentally useless, which is an issue that has been partially covered in the CryptoIQ War On Shitcoins, but there are a handful of cryptocurrencies that stand out from the rest and are unique and valuable. Monero (XMR) is the latter, it is a fundamentally useful cryptocurrency that provides true anonymity. In other words, Monero (XMR) is the king of stealth cryptocurrencies as will be explored in this article, and at $73 per coin out of a supply of only 17.2 million, it seems to be significantly undervalued. 

To understand how Monero (XMR) is unique, it is first important to understand how it differs from Bitcoin (BTC). Every Bitcoin (BTC) transaction is stored and publicly viewable in the block explorer. In combination with the rise of blockchain forensics, this makes it possible to link Bitcoin (BTC) addresses with the identities of individuals and then track wherever that Bitcoin goes. Essentially, Bitcoin (BTC) is only pseudo-anonymous and sometimes not anonymous at all. 

Monero (XMR) was designed to have total anonymity. This is accomplished via ring signatures and stealth addresses

Bitcoin (BTC) transactions are signed with a user’s private key and can be verified with the public key, making transaction origins and destinations publicly viewable. A ring signature, on the other hand, uses the keys from several unrelated outputs on the blockchain, in addition to your private key, to sign the transaction. This makes it impossible to determine where the transaction actually originated since it can not be proven which of the keys in the group of signatures sent the transaction. Therefore, ring signatures provide automatic decentralized and trustless mixing. 

Stealth addresses provide the other critical piece of privacy. When someone sends Monero (XMR), they create a random public address on behalf of the recipient. Every Monero (XMR) transaction sent to a particular recipient goes to different addresses, obfuscating the destination of a transaction. Only the sender and receiver know where a transaction ended up, and no outside observer can figure that out. Also, the recipient has a view key, so they are the only ones who can see all of the transactions that have landed in their address. 

Another important factor is that all Monero (XMR) users are required to use these privacy features. They are not optional. This prevents Monero (XMR) users from choosing to be transparent, which would allow blockchain forensics to make inroads into figuring out who is using the network. 

Aside from powerful privacy technology, Monero (XMR) is also trying to decentralize its mining network by inhibiting application-specific integrated circuits (ASICs). It is a long term battle since, if any cryptocurrency is valuable enough, ASICs are created for it. In October, Monero (XMR) is releasing a new mining algorithm called RandomX in order to stifle ASICs and put the hashrate back in the hands of CPU and GPU miners. 

This is important because ASICs have overtaken the Bitcoin (BTC) network and forced out all CPUs and GPUs. The result was the relative centralization of mining power into the hands of people who can afford ASICs, whereas Monero (XMR) is trying to make it so anyone with a computer can still mine Monero (XMR) with a CPU or GPU. 

Finally, Monero (XMR) has managed to drastically decrease its transaction size and transaction fees via implementing bulletproofs. Long term, Monero (XMR) has a minimum block reward in order to sustain the mining network even if transaction fees stay as low as possible. Essentially, Monero (XMR) is designed to be quite scalable. 

During the altcoin bull run that peaked in January 2018, Monero (XMR) briefly went as high as $480, before crashing to $40 during the worst of the bear market in December. During the mini bull run that peaked in June Monero (XMR) went as high as $120, before settling just above $70 now. 

It seems Monero (XMR) is undervalued, considering it is the top choice for cryptocurrency users who want true anonymity. As well, Monero (XMR) has made strides to keep its network as decentralized as possible and scalable. We can speculate that, when the next major Bitcoin (BTC) bull run happens, Monero (XMR) will be poised to be one of the most profitable cryptocurrencies.