Monero (XMR) sets itself apart from other cryptocurrencies by capitalizing on privacy and anonymity. While it’s often grouped with ZCash (ZEC) as a privacy currency, XMR’s development closely mirrors that of Bitcoin (BTC). Just like Bitcoin (BTC), XMR was developed by a niche tech group and grew with assistance from the community. The difference is that Monero was also designed to improve upon what people see as weaknesses in Bitcoin’s privacy features.
The currency’s dedication to privacy and security is one of the main reasons why people invest in and use XMR. If this is exactly what you’re looking for in your first foray into the world of crypto, then you’re in luck, as Monero can be quite accessible even for total newbies. To get started, simply create a Monero account (also called a wallet) for storing the currency. You can easily do this by signing up for and XMR wallet. After this, you can start buying, selling, and using XMR.
A Look at Monero’s Privacy Features
Before acquiring XMR, it’s important for newbies to become familiar with the three elements that contribute to Monero’s non-traceable design. Knowing about these features will help you make the most of the currency as you go along your journey.
The first is Ring Signatures, which obfuscates the user’s digital signature by adding 10 more digital signatures to the mix. The technology makes it appear that any one of these 11 individuals could have initiated the transaction. Next is Stealth Addresses, which automatically creates one-time accounts to be used with every exchange. Finally, it’s also possible to hide the amount of each transaction using Ring Confidential Transactions.
Now that you have an idea of how Monero’s privacy features work, you’re ready to start learning how to use it.
After setting up a Monero wallet, you need to buy some XMR. This can be done by purchasing it using a cryptocurrency you already own, such as BTC or Litecoin (LTC). It’s also an option to use fiat currencies, depending on the funding methods available to your location or the wallet that you’re using.
Once the funds that you want to use to buy Monero have been transferred to your chosen wallet, you’re ready to buy currency. Simply fill out the order form used by your chosen XMR wallet and follow the step-by-step purchasing instructions.
Another way to earn XMR is by mining, which means using your computer’s CPU or GPU to verify transactions on the Monero blockchain in exchange for some XMR coins. Unlike BTC, which requires users to invest in costly hardware, Monero can be mined using a standard personal computer and operating system. You can choose to solo mine or mine in a pool, and each option has its pros and cons. That being said, most users are advised to solo mine using the Monero software to help make the XMR network more robust.
Perhaps you want to invest in another cryptocurrency and you need to sell XMR to free up some funds, or you no longer find it necessary to invest in a currency that specializes in offering anonymity. No matter the reason, you can easily sell Monero using your wallet. Once you’ve logged into your account, you can choose to exchange XMR for another cryptocurrency or sell it for USD or EUR. To do this, simply fill out the required forms and follow the instructions for selling your XMR.
Take note that depending on the platform you’re using to carry out these transactions, you may need to get through some level of verification before you can start any exchange.
People who have Monero often use the currency in two different ways: buying and trading. The differences between buying and trading are not always clear-cut, but here’s a rundown of what each activity entails.
Buying Using Monero
Once you’ve got some Monero, you can use it for whatever transactions you’d like, as long as the recipient accepts the currency. Perhaps you want to transfer it to another user or pay for goods and services. For example, you may want to take advantage of the currency’s price to commission a work of art. You can transact with an artist and arrange for the payment to be made in Monero, then use your wallet to finalize the transaction. In general, using cryptocurrency in this way is often seen as less risky compared to trading it.
Trading, on the other hand, means holding on to the currency specifically to speculate on its price action. Many Monero users hold on to a representation of the currency on the belief that the demand for it will increase in the near future. When this happens, they can cash in on their investment and grow their wealth. Traditionally, trading is associated with short-term positions and is seen as riskier, especially when users are buying contracts or using margins to increase their profit.
There’s a bit of a learning curve that you need to overcome if it’s your first time dealing with cryptocurrencies like XMR. Once you have a clear idea of how it works and the strategies you need to make the most of your investment, you have a much better chance of maximizing the features and advantages offered by the cryptocurrency of your choice.