Intro to Monero
Monero, originally called BitMonero, is an open-source cryptocurrency that focuses on fungibility, privacy and decentralization. Created in 2014, Monero has been dubbed the ultimate privacy token because it uses an obfuscarted public ledger. This means that no outside observer can see the source, total amount or destination of any transaction on the blockchain. Because of this, it is nearly impossible to track Monero payments and hence is a privacy focused currency. Monero’s symbol on exchanges is typically XMR.
Who Created Monero?
Monero was actually started by an anonymous message board user. Sound familiar? That’s exactly how Bitcoin was created in 2009, by the infamous Satoshi Nakamoto. However in this case, there was no whitepaper produced. A Bitcointalk forum user knowns as thankful_for_today forked the codebase for Bytecoin, and called it BitMonero. Bit obviously coming from Bitcoin and Monero coming from the word for coin in the auxiliary language Esperanto. The coin was originally created in 2014, and was not an immediate success. A group of fellow BitcoinTalk users eventually took over the project after thankful_for_today seemed to have abandoned it shortly after creating it. In 2017, a well known Bitcoin Core developer Greg Maxwell, made some huge improvements to the privacy features of the coin, mostly focusing on a confidential transactions algorithm and ring signatures, which we will explain in the next section.
What Is The Tech Behind Monero?
Monero uses CryptoNight proof-of-work, which is a unique type of hash algorithm. It is quite different than the Bitcoin protocol as it uses the cryptography concept of ‘ring signatures’. What are ‘ring signatures’? Essentially ring signatures will mix a group of transactions or blockchain entries together so that it is virtually impossible to tell who is the sender and who is the receiver of a certain transaction.
When it comes to mining, Monero was made to be ASIC resistant. This means the creators purposely did not want mining to be centralized. Unfortunately this hasn’t quite worked out for them, as at the time of writing, over 45% of Monero was controlled by 3 mining pools.
How Do Regulators Feel About Monero?
Monero is considered controversial to many on the regulatory side of the crypto industry. Since Monero is the closest thing we have to a truly private currency, it means that anyone can use it for legitimate, or nefarious purposes.
Although not for it’s original intent, the emergence of privacy coins such as Monero allow users to completely hide their identity, making the currency an ideal choice for online hackers and criminals. Monero is often accepted on DarkNet markets where users can buy drugs, guns and other illegal merchandise.
Japanese authorities have recently banned any Japanese based cryptocurrency exchanges or platforms from listing privacy coins. They cited concerns with money laundering and illegal activity as reasons for the ban.
However, Monero isn’t all bad news. Many law abiding cryptocurrency users prefer Monero in order to make legal transactions, for it’s privacy features and ease of use. Also, cryptocurrency price speculators have predicted that Monero could turn into one of the most used cryptocurrencies as our digital society moves more towards data privacy.
How To Buy Monero (Step-By-Step)
1) Buy Bitcoin
What? Buy Bitcoin to get Monero? Let us explain. Monero is a popular digital currency, but not considered one of the top 5 in terms of trading volume. At the time of writing, in June 2019, almost 5 years after Monero was originally created, there is no Canadian Dollar- Monero (CAD/XMR) market available on any exchange listed on CoinMarketCap. This means, you can not directly buy Monero with Canadian dollars through a trusted exchange. This is the same with many international currencies.
As mentioned previously, Monero is considered somwhat controversial because of it’s association with the dark market and money laundering. For that reason, many exchanges There are several exchanges where you can buy Monero with USD, however they have low liquidity. Your best bet to get Monero for the best price is to exchange it for Bitcoin. To do this, you’ll need to buy bitcoin online from a fiat/Bitcoin on-ramp.
You can Buy Bitcoin in Canada through Bitbuy, Canada’s trusted choice for buying and selling digital currency.
If you are in any other country, Blockgeeks is a great on-ramp for buying Bitcoin that can be exchanged for Monero. Users can easily buy Bitcoin with simple credit card transactions, using USD or EUR.
If you don’t want to use an exchange, there are of course, other ways to acquire Bitcoin. These include options such as a Bitcoin ATM, or a Peer-to-Peer exchange. For more details on the best ways to get Bitcoin, check out our previous article on how to buy Bitcoin.
2) Send your Bitcoin to a crypto-crypto exchange
As mentioned before, you will need to exchange Bitcoin for Monero in order to get the best price. To do this, you’ll need to send your Bitcoin to an exchange that offers a BTC/XMR, or Bitcoin-Monero market. To do this, you can ‘withdraw’ your Bitcoin from your exchange and send it to a deposit address of the exchange that offers Monero.
One popular exchange that offer a BTC/XMR market are Binance, which is the largest cryptocurrency exchange by trading volume in the world. Binance has a massive amount of liquidity, meaning there are a lot of buyers and sellers active on the platform with almost all of it’s markets. When there are more buyers and sellers, you have a better chance of getting the best possible price.
Bitfinex is another popular exchange that offers a BTC/XMR market, as well as Huobi. To find the list of all the popular Monero markets, check out CoinMarketCap Monero Markets page.
3) Withdraw to a wallet
With any digital currency, including Monero, it’s considered best practice to withdraw your digital currency off an exchange to a personal wallet. Monero does have a few dedicated wallets, although not as many as other popular currencies due to its unique properties. If you are looking for a Monero wallet, there are web, mobile and hardware based options that we break down below.
Web Based Wallet For Monero
My Monero is a web based wallet that allows users to send and receive Monero from their browser. Users control their private keys so that Monero can be recovered from any device. You can easily send, receive and see transaction history of all your Monero transactions right in the UI. My Monero is definitely easy enough for beginners to use. My Monero is available for Mac and Windows devices, and can be downloaded from their website.
Mobile Based Wallet Solutions For Monero
Monero has a mobile based wallet called Monerujo, built specifically for the Android platform. Users can send Monero, receive Monero and create new addresses from their mobile device. They can also move Monero between multiple devices. Monerujo is only available for Android, perhaps because Android is considered the more privacy based operating system. Cake Wallet, is an iOS alternative for Apple users looking for a place to send and receive Monero on their iPhones.
Hardware Wallet Solution For Monero
For those looking to hold onto their Monero for a long time, there is nothing better than a cold storage, hardware wallet solution. The Ledger Nano S is one of the most popular and most used hardware wallets on the market. Ledger recently added Monero support on the Nano S wallet platform
How To Buy Monero Wrap Up
Monero is certainly a digital currency that is here to stay, as it’s usage and adoption is showing no signs of slowing down. Despite it’s private, and therefore controversial nature, Monero has incredibly unique and powerful tech that will keep it’s fans coming back.
Even if regulators step in, it will be hard to slow down users who are looking for a usable privacy token, as the digital trend of privacy protection continues. If you are looking to buy Monero, we hope this guide has given you enough information in order to complete your first Monero purchase. Make sure to visit Bitbuy resources for more useful guides.