Monero was always a highly controversial cryptocurrency, mostly associated with criminals, illegal activities, and the dark side of the web. Despite its controversy, Monero is here to stay and brought so far “Big Bucks” to everyone who held it since the beginning of 2019. What is the true usage of Monero and what did its price-action achieve so far?
What is Monero – Explained
Monero is a private decentralized cryptocurrency. But what does “private” actually mean? Let’s Clarify the difference between privacy and anonymity.
Privacy means that you don’t want others to know what you’re doing while anonymity means that you don’t mind that people know what you’re doing, you just don’t want them to know that you’re the one doing it.
For example, privacy is when you lock the door to a bathroom because you want to keep what’s going on in there private, while anonymity is when you post data that can’t be linked back to you on the web in order to bring something to the public’s attention. If you look at Bitcoin, it’s certainly not private. The Bitcoin blockchain is completely public and all transactions can be viewed by anyone on the web.
Why use Monero?
Isn’t Monero only for criminals? Well, while criminal activity can benefit a lot from a private cryptocurrency, there are more than enough legitimate reasons for privacy as well.
For example, with the amount of data being displayed on blockchains like Bitcoin and Ethereum, it’s become easier these days to identify patterns, map real-life identities, connect between addresses, and uncover behavioral information about users.
So if you don’t like companies analyzing your data in order to map out your behavior or purchasing patterns, you may consider using a private cryptocurrency. Additionally, since all address balances are completely transparent, you may become subject to attacks if you hold large amounts of Bitcoin.
Another thing to consider is market prediction. If I know a certain address belongs to a certain exchange, I can track it for incoming transactions. If I see a large amount coming in then I can assume that a big sell order is on its way and short the currency for a profit, though in a truly perfect market, this will not exist.
Monero Technical Analysis
Ever since the beginning of 2019, Monero witnessed a very healthy uptrend, starting with a price of USD 44 all the way to today’s price of USD 126, making a whopping 184% gain.
Fig.1 XMR/USD 1-Day chart, 2019 to date – TradingView.com
We can clearly notice a sideways trend coming to an end, with the latest price-action breaking out of the upper resistance area of USD 120. This price might either become a strong support area, or a fakeout was at play and prices may fall slightly. It all comes down to the performance of the whole cryptocurrency market as a whole. If the crypto market cap continues to rise, Monero will definitely reach the next area of USD 170 by Q1 2021.
Fig.2 XMR/USD 1-Week chart, potential price increase to a new level in Q1 2021 – TradingView.com
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