Bitcoin
Now Reading
This Anonymous Cryptocurrency Has Privacy Advocates Talking
6

This Anonymous Cryptocurrency Has Privacy Advocates Talking

by Justin OConnellOctober 10, 2016

Monero is an anonymous crypto-currency known for being preferred by dark net’s largest marketplaces, where drugs and illicit goods are sold. Darknet marketplaces were made popular by Ross Ulbricht’s Silk Road, which landed him a lifetime in prison.

The newest cryptocurrency craze preys upon modern privacy concerns. It cites how big banks, corporations, and governments keep tabs on everything in the marketing materials. This is very much similar to Bitcoin’s early marketing. Unlike Bitcoin, which has a 21 million market cap, Monero has none. It was forked from Bytecoin.

“There is no safe place to conduct private transactions,” a marketing video for the crypto-currency says. “Until now. Meet Monero. It’s private untraceable currency, only you control and are responsible for your funds.”

monero

The currency takes advantage of an arbitrage created by Bitcoin’s transparent network, where funds are sent on an open network, which has even caused concern among suits from the world’s foremost corporations, who lament just how transparent Bitcoin truly is.

There have been noted vulnerabilities in Monero in the past. Security firm MWR recently publicized a vulnerability in Monero, which might allow people to steal Monero from third-party digital wallets. An attacker must fool a Monero user into visiting a web page to initiate the attack first, however. MWR disclosed the vulnerability to the developers of leading Monero wallet, SimpleWallet. The issues was fixed in a software update.

Monero’s big break came earlier this summer when AlphaBay, a large online market for drugs and other illicit goods, announced the platform would support the digital currency starting September 1. AlphaBay remains online and accepting orders until this day, including in Monero.

Monero, unlike other crypto-currencies, was built from the ground up based on a protocol called CryptoNote described in a 2012 whitepaper written by Nicholas van Saberhagen, a presumed pseudonym. Many other crypto-currencies merely copy and paste bitcoins code base. 

Monero creates unique addresses for all transactions using a private “viewkey” so only the receiver has access to full transaction info. Monero “mixes” coins also, jumbling similar sized transactions with each other.

When AlphaBay announced Monero integration, Monero trading was at about $40 million USD. Monero’s market cap grew in the wake of the announcement, reaching $60 million the following day. Currently, the market capitalization sits around $100 million. At one point, it reached more than a $200 million market cap.

Monero runs on the CryptoNight proof-of-work algorithm. Designed to work with ordinary PC CPUs, there are no special purpose devices for mining devices currently available. The CryptoNight can only be CPU-mined for the time being.

A sign of how popular Monero has become: MoneroMarket recently opened, which represents the first XMR only darknet marketplace. Although, its not been easy for founders:

MoneroMarket is NOT associate in any way with Oasis. We have put lots of efforts to bring a new market that accept exclusively XMR and it’s actually a nightmare. We keep reading messages saying we are LE, we keep reading messages we are Oasis, we keep reading messages we are a scam, we keep reading shit about us.

MoneroMarket’s main goal was to create a simple to use darknet marketplace using only Monero thanks to its privacy advantages. Monero is not the only cryptocurrency which markets total privacy. Another option, one that’s quite popular actually, is Dash.

Monero functions with the consensus protocol called Proof of Work Anonymous, which is very much like bitcoin’s consensus algorithm, but with further anonymizing processes.

Some complaints lobbied against Monero are its instamine and unfair distribution in coins, as catalogued here on BitcoinTalk. Others include backhanded and troll-like marketing tactics by the Monero Marketing team in a concerted mis-information campaign.

Nonetheless, in appealing to the hardcore privacy advocates, Monero and crypto-currencies like it have carved out a niche left coin-less after revelations about Bitcoin’s true transparent nature trickled down to the mal-informed.


Advertised sites are not endorsed by us. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
What's your reaction?
Love it
35%
Funny
3%
Meh..
16%
What!?
6%
Hate it
39%
  • fluffypony

    If you’re relying on Bitcointalk for your facts you’re going to have a bad time.

    Monero has no instamine, no unfair distribution, and it has no marketing team…

  • JmGx

    Zero research was conducted in writing this article, apparently.

  • Stefanos Ioannou

    I won’t go through all the inaccurate information. But Monero instamine? Where did you get this? Gossip magazine?

  • DarknetMoonero

    many facts are wrong. Some parts are total jibberish.

  • xmr_eric

    XMR had no instamine.

  • Spencer Rhodes

    This is a terribly misinformed piece. I was going to point out a couple of blatantly incorrect statements, but it looks like a few others have already beat me to it. Are you intentionally spreading misinformation about Monero or did you do this out of ignorance. I can understand the latter, actually. There has been a deluge of negative blog coverage directed toward Monero lately, ranging from subtle misrepresentation to outright lies. Do some diligent research and consider writing another piece on the subject.

    There was no pre-mine/insta-mine with Monero. That was Bytecoin (approx. 80% of supply) and also Dash to a lesser degree.

    Getting you facts from forum jabberheads on Bitcointalk or Reddit is convenient perhaps, but you should do some due diligence in fact checking those ‘facts’.

    Read up on how the Monero code handles transactions as well. I think you’ll find it quite interesting. A ‘mixer’ would be a very reductive description for it.

    The third party wallet vulnerability was just that, a vulnerability within this party wallets. There was never any vulnerability with a proper CLI wallet built from the source code. The Monero development team implemented code to address the third party wallet issue before the news was released to the public. Anyone who is serious about security would not use a third party wallet service anyway.

    There is a huge unrealized market demand for truly anonymous transaction for which Monero offers a technically viable solution. This demand is currently hidden within bitcoin’s very large shadow. As you mentioned, Bitcoin cannot offer true anonymity. It would be very foolish to use Bitcoin for discreet transactions, such as those done through any sort of darknet exchange, yet Bitcoin is still the most common currency used for this purpose. It may take a couple of high profile cases of darknet exchanges and/or their users being tracked down and prosecuted by law enforcement thanks to any of these emerging blockchain tracking services before the rest of the undergoing market realizes the risk they are taking in using Bitcoin, but it will happen sooner or later. At that point Bitcoin will cough up its entire market share of discreet transactions to whichever cryptocurrency offers the best alternative, and right now that is Monero.