Monero (cryptocurrency)

[Niko]

Monero (cryptocurrency)

Monero (XMR) is an open-source cryptocurrency created in April 2014 that focuses on fungibility and decentralization. Monero uses an obfuscated public ledger, meaning anyone can broadcast or send transactions, but no outside observer can tell the source, amount or destination. Monero uses a Proof of Work mechanism to issue new coins and incentivize miners to secure the network and validate transactions.

The privacy afforded by Monero has attracted illicit use by people interested in evading law enforcement during events such as the WannaCry Ransomware Attack, or on the dark web buying illegal substances. [1] [2] Despite this, Monero is actively encouraged to those seeking financial privacy, since payments and account balances remain implicit hidden, which is not the standard for most cryptocurrencies. [3] [4]


*Architecture
Unlike many cryptocurrencies that are derivatives of Bitcoin, Monero is based on the CryptoNight proof-of-work hash algorithm, which comes from the CryptoNote protocol. It possesses significant algorithmic differences relating to blockchain obfuscation. [5] [6]

In particular, the ring signatures mix the spender's input with a group of others, making it exponentially more difficult to establish a link between each subordinate transaction. [2] [7] Also, the "stealth addresses" generated for each transaction make it impossible to discover the actual destination address of a transaction by anyone else other than the sender and the receiver. [8] Finally, the "ring confidential transactions" mechanism hides the transferred amount. [9] [2]

Monero is designed to be resistant to application-specific integrated circuit mining, which is commonly used to mine other cryptocurrencies such as Bitcoin. It can be mined somewhat efficiently on consumer grade hardware such as x86, x86-64, ARMand GPUs.