To most people, financial privacy is very important. Yet in recent years, we have seen a staggering amount of big corporations, banks and governments having their records compromised, at every time leaking information about their users, their practices, their balance sheets. The unfortunate but undeniable conclusion is that there is no safe place to conduct private transactions.
There was no safe place to conduct private transactions. Monero provides a place where your financial activities are private.
Monero is one of the leading cryptocurrencies in the post-Bitcoin world, and it is built on principles of privacy, decentralization, and scalability.
Read on to find out how Monero is helping to solve real problems and limitations of existing cryptocurrencies, and building a more private blockchain.
## PRIVACY
Monero seeks to provide absolute transactional privacy in an effort to create true electronic cash.
With Bitcoin, as well as with the vast majority of cryptocurrencies that have been established since, any and all transactions are entirely traceable. Any casual observer can read through the Bitcoin blockchain, and for any transaction, this observer can find out the exact amount that was transacted, as well as the precise transaction origin (sender address) and destination (recipient address).
With Monero, for any private transaction[1], the same observer has no means to uncover the origin, destination, or amount transacted. As such, transactions on the Monero blockchain, are private and fundamentally untraceable.
But Monero is more than a currency. Driving the official slogan: “secure, private, untraceable”, there are a multitude of applications where the parties involved wish to remain private. The Monero blockchain can keep confidential contracts, well… confidential. While the forthcoming, blockchain-powered internet of things will certainly place the cloud all around us, it is then increasingly important that open access tools exist to provide a secure boundary for private settlements.
An often overlooked, but nonetheless important layer of privacy in a connected world, is that of the networking infrastructure. We have teamed up with Privacy Solutions, and development is well underway to incorporate an i2p router in Monero. In a world where ill intentioned governments and ISPs can void an individual’s basic privacy rights on a whim, it then becomes necessary to establish a private communication platform.
The underlying technologies and cryptography upon which Monero is built, has been (and continues to be) the subject of extensive analysis and review by numerous individuals and research groups. It has garnered favorable attention by some of the most prominent figures of the Bitcoin & cryptography world, such as Andrew Poelstra (andytoshi), Gregory Maxwell & Nicolas Courtois.
[1] With Monero, transactions are private by default. However, each user has the ability to select different levels of privacy, optionally exposing the amount of a given (own) transaction, or even provide audit access (view only) to his full Monero account.
## DECENTRALIZATION
While most cryptocurrencies align to theoretical principles of decentralization, the reality is, that most fall short of such a claim. More often than not, it is not just one branch of a cryptocurrency system that is centralized in one form or another, is that that many branches are so.
With Proof of Stake currencies, irregular emission and distribution models cause most of the staking power to end up in the hand of a privileged few. Participants of lesser weight are reduced to second class citizens, with little chance of ever obtaining similar returns.
With Proof of Work currencies, of which Bitcoin remains the most significant reference, the mining process is largely concentrated in a handful of pools. This centralization of mining power, combined with a transparent blockchain, has already lead to various occurrences of transaction censorship.
Other currencies opt for a closed development model, thus centralizing the invention process itself. These closed platforms commonly fail to meet any form of public audit or expert review. More importantly, these are platforms that will anytime swing left and right, in order to satisfy the interests of the restricted group that holds control of development.
Monero contrasts with these examples in various and meaningful ways.
Monero is powered strictly by Proof of Work, but specifically, it employs a mining algorithm that has the potential to be efficiently tasked to billions of existing devices (any modern x86 CPU).
This very characteristic, and more so once it is coupled with @Smart Mining, has the potential to ensure that for long years to come, the process of mining new Monero coins is within reach of the common individual, and not an exclusive opportunity to the owners of large mining operations.
Further, as transactions are private by default on the Monero blockchain, transaction censorship is inherently void.
The Monero development landscape on the other hand, is very much the opposite of a closed or restricted access model. The core branch currently enjoys more than 30 contributors, pushing 1000+ commits over the past year {there has to be better stats to put in there}. The project is happy to take on new contributors and any future plans, long term direction and priorities are openly discussed with the community. Indeed, the policy that governs contribution to the Monero codebase is exhaustingly inclusive - all contributions are accepted into the development branch, where new code can be scrutinized and tested by the entire community.
Most contributors in the Monero development landscape are quite passionate for an open source philosophy, and in this rich creative environment, new projects have sparked to life. @OpenAlias is one notable example, which has seen adoption by (amongst others) a major Bitcoin related software product.
