{"id":8073,"date":"2025-05-30T20:37:09","date_gmt":"2025-05-30T19:37:09","guid":{"rendered":"https:\/\/investx.fr\/en\/?p=8073"},"modified":"2025-05-30T20:37:12","modified_gmt":"2025-05-30T19:37:12","slug":"monero-xmr-what-how-works","status":"publish","type":"post","link":"https:\/\/preprod.investx.fr\/en\/learn\/crypto\/monero\/","title":{"rendered":"Monero (XMR) : What It Is How It Works and What This Anonymous Crypto Is Used for in 2026"},"content":{"rendered":"\n
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What is Monero ?<\/h2>\n\n\n\n

Monero (XMR) is a cryptocurrency that focuses on anonymity and makes its transactions untraceable by using several advanced cryptographic techniques. Unlike Bitcoin <\/a><\/strong>or Ethereum<\/a><\/strong>, which operate on transparent blockchains where all transactions are publicly visible, Monero<\/strong> uses an opaque blockchain<\/strong> that completely masks sensitive information.<\/p>\n\n\n\n

The main objective of Monero<\/strong> is to be a totally fungible<\/strong> cryptocurrency, meaning it should not be possible to distinguish between different XMR tokens. This characteristic plays an essential role for a true currency, as it ensures that everyone attributes exactly the same value to each unit, without discriminating based on its usage history.<\/p>\n\n\n\n

In the cryptocurrency ecosystem<\/strong>, Monero<\/strong> occupies a unique position as a defender of financial privacy. It is impossible to identify either the person who sent XMR, the person who received it, or the amounts involved in these exchanges.<\/p>\n\n\n\n

The History of Monero<\/h3>\n\n\n\n

The history of Monero<\/strong> begins in April 2014, when it was launched under the name BitMonero, a fusion of “Bit” (reference to Bitcoin<\/strong>) and “Monero” (which means “coin” in Esperanto). Shortly after its launch, the community decided to shorten the name to simply Monero<\/strong>.<\/p>\n\n\n

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\"Logo<\/figure>\n<\/div>\n\n\n

Originally, Monero<\/strong> was a fork of Bytecoin, another privacy-focused cryptocurrency. However, the community discovered that 80% of Bytecoins<\/strong> had already been issued before the public launch, which led to the creation of Monero<\/strong> as a more equitable alternative.<\/p>\n\n\n\n

Over the years, Monero<\/strong> has undergone several major updates that have strengthened its privacy capabilities and improved its performance. Among the most important are the introduction of RingCT (Ring Confidential Transactions<\/strong>) in January 2017, which allowed for hiding transaction amounts, and the implementation of Bulletproofs in October 2018, which significantly reduced transaction size and therefore associated fees.<\/p>\n\n\n\n

Who Created Monero ?<\/h3>\n\n\n\n

Like Bitcoin, Monero<\/strong> doesn’t have a single clearly identified founder. The project was launched by a developer known under the pseudonym “thankful_for_today<\/strong>“, but the direction of development was quickly taken over by a larger team after disagreements about the project’s orientation.<\/p>\n\n\n\n

Among the important figures who contributed to the development of Monero<\/strong>, we can mention Ricardo “fluffypony” Spagni, who was the main maintainer of the project for several years, as well as developers like Francisco “ArticMine” Caba\u00f1as and Luigi1111.<\/p>\n\n\n\n

The Monero<\/strong> development team is known for its decentralized approach and transparency. Decisions regarding the evolution of the protocol are made collaboratively, with strong community involvement<\/strong>.<\/p>\n\n\n\n

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It’s important to note that, unlike many cryptocurrency<\/strong> projects, Monero<\/strong> did not have any premining or initial token sale, which reinforces the fairness of distribution and alignment of interests between developers and the community.<\/p>\n<\/blockquote>\n\n\n\n

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What is Monero (XMR) Cryptocurrency Used For ?<\/h2>\n\n\n\n

The Monero<\/strong> (XMR) fulfills several essential functions that distinguish it from other cryptocurrencies and give it unique utility in the crypto ecosystem<\/strong>.<\/p>\n\n\n

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\"Monero<\/figure>\n<\/div>\n\n\n

First, Monero<\/strong> serves as a private and confidential medium of exchange<\/strong>. In a world where financial surveillance is ubiquitous, Monero<\/strong> offers users the ability to conduct transactions without revealing their identity, the transaction amount, or the history of their funds. This privacy is particularly valuable for people living under authoritarian regimes, businesses wanting to protect sensitive commercial information, or simply individuals concerned about their privacy.<\/p>\n\n\n\n

Second, Monero<\/strong> functions as a censorship-resistant store of value<\/strong>. Unlike fiat currencies that can be frozen or seized by governments, or even transparent cryptocurrencies like Bitcoin where funds can be traced and potentially blocked, Monero<\/strong> offers protection against financial censorship.<\/p>\n\n\n\n

Third, Monero<\/strong> serves as a truly fungible currency<\/strong>. With altcoins for example, certain coins can be “marked” as having been used in illicit activities, which can lead to their rejection by certain market participants. With Monero<\/strong>, each XMR is indistinguishable from others, thus ensuring perfect fungibility.<\/p>\n\n\n\n

Finally, Monero<\/strong> enables the development of privacy-respecting decentralized financial applications and plays an important role in promoting financial freedom as a fundamental value<\/strong>.<\/p>\n\n\n\n

How Does the Monero Network Work ?<\/h2>\n\n\n\n

The Monero<\/strong> network distinguishes itself through its unique architecture, specifically designed to guarantee transaction privacy and anonymity while maintaining network security and integrity.<\/p>\n\n\n\n

The Architecture of the Monero Blockchain<\/h3>\n\n\n\n

The Monero<\/strong> blockchain operates on a Proof of Work<\/strong> (PoW) consensus model, similar to Bitcoin, but with significant differences. The network uses the RandomX<\/strong> algorithm, specially designed to be ASIC-resistant. This ASIC resistance promotes a more equitable distribution of mining and better network decentralization<\/strong>, as it allows ordinary users to participate in mining with standard CPUs.<\/p>\n\n\n

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\"Blockchain<\/figure>\n<\/div>\n\n\n

Each block in the Monero blockchain<\/strong> is generated approximately every two minutes, which is faster than Bitcoin (10 minutes). This faster cadence allows for quicker transaction confirmations while maintaining network security<\/strong>.<\/p>\n\n\n\n

A distinctive characteristic of Monero<\/strong> is its emission policy. Unlike Bitcoin which has a fixed cap of 21 million coins, Monero<\/strong> has an initial emission of 18.4 million XMR, followed by a continuous emission of 0.6 XMR per block in perpetuity.<\/p>\n\n\n\n

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This “emission tail<\/strong>” is designed to maintain a constant incentive for miners to secure the network, even after the initial emission is completed.<\/p>\n<\/blockquote>\n\n\n\n

Monero’s Privacy Technologies<\/h3>\n\n\n\n

Monero’s privacy is based on three main cryptographic technologies :<\/p>\n\n\n\n

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  1. Ring Signatures<\/strong> : This technology allows the sender of a transaction to hide their identity by mixing their signature with those of other users. For an outside observer, it’s impossible to determine which of the signatures in the “ring” is that of the actual sender.<\/li>\n\n\n\n
  2. The Monero network generates a unique one-time address for the recipient each time a transaction is made. This means that even if someone knows you use Monero<\/strong>, they cannot see how many transactions you have received or the amounts involved.<\/li>\n\n\n\n
  3. RingCT (Ring Confidential Transactions)<\/strong> : Introduced in 2017, this technology masks transaction amounts, thus providing complete privacy for all aspects of the transaction.<\/li>\n<\/ol>\n\n\n
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    \"Monero<\/figure>\n<\/div>\n\n\n

    In 2018, Monero<\/strong> also implemented Bulletproofs<\/strong>, a technology that significantly reduces transaction size by about 80%, thus decreasing transaction fees and improving network scalability.<\/p>\n\n\n\n

    All these technologies work together to create a system where transactions are verifiable<\/strong> (ensuring there is no double-spending or fraudulent money creation) while being completely private<\/strong>.<\/p>\n\n\n\n

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    Advantages and Disadvantages of Monero<\/h2>\n\n\n\n

    Like any technology, Monero<\/strong> presents advantages and disadvantages that are important to understand in order to evaluate its potential and limitations.<\/p>\n\n\n\n

    Advantages of Monero<\/h3>\n\n\n\n