Monero (XMR) Analysis

8 min read April 17, 2024
Richard Fetyko

Monero (XMR) Analysis

Monero (XMR) Analysis

In addition to automated chart patterns, altFINS’ analysts conduct technical chart analyses of top 30 cryptocurrencies. We call these Curated Charts and they evaluate 5 core principals of technical analysis: Trend, Momentum, Patterns, Volume, Support and Resistance.

Monero (XMR) technical analysis:

Trade setup: Price is in a downtrend. After getting delisted by Binance, price cratered to $100. It’s trading in a Channel Down pattern. We wait for a bullish breakout, which could see price revisit $150 resistance level and 200-day moving average. (set a price alert).

Pattern: Price is trading in a Channel Down pattern. With emerging patterns, traders who believe the price is likely to remain within its channel can initiate trades when the price fluctuates within its channel trendlines. With complete patterns (i.e. a breakout) – initiate a trade when the price breaks through the channel’s trendlines, either on the upper or lower side. When this happens, the price can move rapidly in the direction of that breakout.

Trend: Downtrend across all time horizons (Short- Medium- and Long-Term).

Momentum is Bearish but inflecting. MACD Line is below MACD Signal Line and RSI is below 45 but momentum may have bottomed since MACD Histogram bars are rising, which suggests that momentum could be nearing another upswing.

Support and Resistance: Nearest Support Zone is $116, then $100. The nearest Resistance Zone is $150, then $175 – $180.

See live Monero (XMR) chart here

See more curated charts of coins with technical analyses.

Monero_Tether_2024-04-17_21-14-50

Recent news and research:

Monero’s Privacy-Focused Crypto Protocol Upgrade Is Now Live

Monero Developers Disclose ‘Significant’ Bug in Privacy Algorithm

What Are Privacy Coins? Monero, Zcash, and Dash Explained

What is Monero?

Monero Team Receives Anonymous $500,000 Donation.

2021 saw Monero climb by over 250% on the charts in just over 4 months. That’s an extraordinary hike, one comparable to the hikes noted by the rest of the market’s alts.

In what is a major development for the communities of both Bitcoin, the world’s largest cryptocurrency and Monero, the market’s leading privacy coin, COMIT Network, an open protocol facilitating “trustless” cross-blockchain applications has announced, “peer-to-peer atomic swaps between Monero (XMR) and Bitcoin (BTC) are now available on mainnet.”

Find more real-time news here.

What is Monero (XMR)?

Find full description and news on altFINS platform.

Overview

Aimed at privacy-preservation and fungibility, Monero is a Bytecoin code fork providing anonymous value transfer through ring signatures, stealth addresses, confidential transactions, and bulletproofs. Monero offers anonymity by default in contrast to the optional privacy preserving functionalities of its peers. In pursuit of decentralization Monero continually changes its proof-of-work algorithm in order to prevent ASICs from dominating and centralizing the mining process.

History

Monero traces its origins back to Bytecoin, the first implementation of CryptoNote, which was an application layer protocol aimed at solving various issues with Bitcoin such as traceability, mining centralization, and irregular coin emission. Bytecoin launched in March 2014; however, after a controversial 80% premine, a Bitcointalk forum user known as thankfulfortoday forked the codebase of Bytecoin into the a new project named BitMonero, a compound of Bit (as in Bitcoin) and Monero (meaning “coin” in Esperanto). The release of BitMonero was poorly received by the community that initially backed it, leading seven community members to fork BitMonero into a new project called Monero. This largely pseudonymous group, led by Fluffypony (Riccardo Spagni), ultimately became the first Monero Core team. Monero launched its project in April 2014 with no premine. Monero’s payment anonymity has garnered significant attention from a panoply of crypto-curious persons. Since its launch Monero has become one of the most widely used darknet currencies in the world due to its anonymity by default features. In 2017 Monero further enhanced its privacy features by incorporating Ring CT signatures, a solution proposed by Bitcoin Core developer Greg Maxwell, that obscures transaction amounts for each entry in the ring signature, in addition to obscuring the transaction address. This provided near complete transaction anonymity in contrast to just sender anonymity as it was previously. In October 2018, Monero implemented bulletproofs, a zero-knowledge proof technology that replaced the previous zero-knowledge range proofs that its confidential transactions relied on. Bulletproofs cut the size of its confidential transactions by at least 80 percent, significantly increasing transaction efficiency. Monero undergoes scheduled hard forks every six months intended to allow Monero to evolve at a regular cadence, while still leaving users enough time to update before being forked away from the network. These hard forks tend to include everything from patches and bug fixes to hashing algorithm changes and functionality upgrades. In December 2019, Fluffypony (Riccardo Spagni), Monero’s lead maintainer stepped down from the project in an effort to further decentralize the project.

Technology

Monero, the protocol, is a distributed, time-stamped ledger of unspent transaction output (UTXO) transfers stored in an append-only chain of dynamic-sized data blocks. A network of mining and economic nodes maintains this blockchain by validating, propagating, and competing to include pending transactions (mempool) in new blocks. Economic nodes (aka “full nodes”) receive transactions from other network participants, validate them against network consensus rules and double-spend vectors, and propagate the transactions to other full nodes that also validate and propagate. Valid transactions are sent to the network’s mempool waiting for mining nodes to confirm them via inclusion in the next block. Mining nodes work to empty the mempool usually in a highest-to-lowest fee order by picking transactions to include in the next block and racing against each other to generate a hash less than the target number set by Monero’s difficulty adjustment algorithm. Monero uses a Proof-of-Work (PoW) consensus mechanism to establish the chain of blocks with the most accumulated “work” (a.k.a., energy spent on solved hashes) as the valid chain. Monero runs a proof-of-work algorithm called RandomX, an algorithm using random code execution and memory-hard techniques for ASIC resistance. Monero initiates hard forks every 6 months to implement upgrades to the protocol, often times changing its PoW algorithm to prevent ASICs from joining the network. Monero’s privacy enhancements stem from ring signatures, which mask sender identities and offers single-use keys to make transactions untraceable. Ring signatures merge a group of signers together to better preserve the anonymity of the true signer. The group is comprised of the actual signers single use key initiating the transaction and past transaction outputs from Monero’s blockchain. Including past transaction outputs helps preserve the senders anonymity because they are theoretically indistinguishable to an outside observer as the valid transaction itself. In January 2017, Monero implemented Ring Confidential Transactions (Ring CTs) in an effort to combat concerns around the true degree of anonymity offered by Monero. Ring signatures only provided privacy for the sender of the transaction, and required outputs to be broken up into separate rings because ring signatures could only contain outputs of the same value. Ring CT signatures aimed to alleviate these concerns by obscuring transaction amounts for each entry in the ring signature, in addition to obscuring the transaction address. With Ring CTs wallets could arbitrarily select ring members from any output size. To prove that certain amounts were spent, Ring CTs used range proofs, a zero knowledge cryptography technique used to prove the amount used in a transaction with revealing the details. However, the range proofs used in Monero’s confidential transactions to ensure the integrity of transactions, were computationally intensive, leading the Monero blockchain to bloat due to the onerous data requirements of each transaction. Thus, in October 2018 Monero implemented bulletproofs, which addressed this scalability issue, cutting the size of its confidential transactions by at least 80 percent and significantly increasing transaction efficiency. Bulletproofs are a non-interactive zero-knowledge proof that does not require a trusted setup. Bulletproofs aggregate information into new data structures that scale logarithmically, rather than linearly, allowing even greater scaling for larger transactions that contain multiple outputs.

Usage Details

XMR is used as a native currency within the Monero network. XMR can be used for peer-to-peer payments and value storage within the Monero network. Monero is also used to pay fees for transactions. Due to it’s robust privacy features, offering anonymity by default, Monero has found significant usage as a black or grey market currency.

Supply Curve Details

Monero employs a constantly decreasing block-reward. When this reaches 0.6XMR per block in 2022 the block reward will no longer decrease, and 0.6 new XMR will be created in every future block. This constant tail emission will have the effect of providing Monero with a small and perpetually decreasing rate of annual supply issuance to the point where issuance is negligible.

 

 

Asset profile is provided by messari. Original version can be found at Messari

Written byRichard Fetyko