Myths About Monero Wallets and Cryptocurrency XMR: A Comprehensive Review
Some neophytes in the crypto world have misconceptions about Monero. Some traders even proclaim that it is a "magic bullet," and they invest more money than they can afford. Don't be fooled. XMR is not a peer-to-peer cryptocurrency or a peer-to-peer wallet.
XMR isn't a privacy-focused cryptocurrency
Monero (XMR) is a peer-to-peer digital currency that is focused on privacy and untraceability. Unlike Bitcoin, which is pseudonymous,Monero and Bitcoin , Monero transactions cannot be traced back to the users' real-world identities. This means that financial regulators can't trace XMR payments or collect information on Monero users.
The Monero network has a very strong security record, making it more secure than most blockchains. It's also at least as secure as systems used by major financial institutions. Monero uses government-grade encryption and uses ring signatures to mask authentication keys. The Monero community is constantly upgrading the network, ensuring that it remains resistant to ASICs.
It's not a peer-to-peer currency
The Bitcoin blockchain makes it easy to see a recipient's wallet address, amount transacted, and source and destination of a transaction. The Monero blockchain is more private, obscuring these details to a degree that is difficult to guess. Using ring signatures, Monero addresses remain anonymous, making it very difficult for bad actors to steal money and send it to a malicious party.
The main advantage of using Monero is its high anonymity. Because its transactions are not traceable, it is popular on the dark web. It is also used for gambling and the sale of illicit drugs.
It's not a shareable private key
The Monero blockchain is one of the most secure in the world when used privately. However, this privacy feature does not make the currency perfect for illicit transactions. A recent study by the RAND Corporation found that privacy coins may not be ideal for illicit transactions on the dark web. Despite this, Monero is still thriving. Its market cap is currently at $4.2 billion, and it has increased by 41% year-to-date. Moreover, regulatory oversight may actually help Monero.
To ensure the privacy of transactions, Monero users must use private spend keys. These keys are not shared and cannot be traced. They are like the "master keys" of a Monero wallet and can only be used for spending XMR associated with the address. Additionally, a user can create a new address for each transaction. In order to use this feature, the user should activate the "subaddress" feature in the wallet.
It's not a hardware wallet
While there is not a dedicated hardware wallet for Monero, the development team is working on one. With Monero's popularity increasing, many users have requested support for hardware wallets. One such wallet is Ledger's Nano S, which supports the cryptocurrency. A hardware wallet is the safest way to store your cryptocurrency, because it is not accessible over the internet. It also supports two-factor authentication, which is a security feature that requires an extra layer of verification.
Hardware wallets also minimize the attack surface. In contrast, software wallets rely on computers and are susceptible to hacking. Hackers can infect your computer and steal your private keys. Hardware wallets store private keys in cold storage. They are also disconnected from the internet, making them less accessible.