One of the key tasks of cryptocurrency creators is to ensure the anonymity of their users. As a matter of fact, the vast majority of digital coins are pseudo-anonymous. The Bitcoin blockchain (and many other cryptocurrencies) is public, and anyone can view transactions in the entire history of the coin’s existence.
However, there are several digital currencies that guarantee the anonymity of their users, and Monero is the leader. In this article, we will review this cryptocurrency and talk about its prospects for 2021.
Tari digital asset platform
Tari is a second-tier solution in the Monero network. It is a digital asset platform. The launch of Tari will probably add value to the Monero ecosystem and may drive up its price. It is planned to mine Tari along with Monero. This means that when mining XMR, the miner also receives a certain amount of XTR. Currently, the Tari test network is functioning. A mobile wallet for IOS and Android has also been created.
Monero updates
The Monero community carries out hard forks of the coin to implement updates, improvements, and new technologies from time to time. They do it twice a year – in spring and autumn.
Regarding these updates, in 2021 we can expect that the price will rise before hard forks. Then the rate will likely fall as traders will fix profits and miners will swap part of the mined coins for BTC or fiat currencies.
Features of Monero emission
People who have been following this coin for some time remember that Monero plans to introduce a new emission mechanism called “tail emission” next May (2022). After that, miners will receive 0.6 XMR per block, which, on one hand, will keep the miners’ interest in this coin, and on the other hand, limit its supply on the market. As is known, the restriction of supply leads to an increased demand for an asset and a subsequent rate rise.
At the same time, it is clear that the “smart money” will start purchasing Monero in advance, without waiting for the “tail emission”. The purchase of this altcoin for investment purposes will likely manifest itself as early as 2021. Thus, we can expect an increase in the price of XMR to BTC in the middle of this year.
However, before this happens, price dumps to repurchase the asset at the lowest possible rate are quite possible. If you want to invest in Monero now, be prepared for this scenario.
XMR and BTC rate correlation
Since Monero is an altcoin, its price depends on the price of Bitcoin. Given this, we can expect the following correlation between Monero and Bitcoin rates in 2021:
- With a moderate rise in Bitcoin, the price of Monero is likely to rise too, both in dollars and in BTC.
- With the explosive growth of the first cryptocurrency, the price of the second is likely to fall when counted in BTC and remain unchanged counted in dollars.
- With Bitcoin flat, the Monero price will most likely rise in both BTC and USD or (less likely) remain unchanged.
- When Bitcoin drops, Monero is likely to go down as well.
This behavior is typical for top altcoins, and Monero is not an exception.
Delisting from centralized exchanges
Monero is the standard and an example of anonymity and privacy. So it is no surprise that it can become the object of scrutiny from governments around the world. In this regard, unfriendly actions concerning the ecosystem of this cryptocurrency are quite possible in the future. They can include the delisting of this coin from centralized exchanges and even attempts to repress public developers.
Although these risks exist, we should not overestimate them. Most Monero developers are anonymous. There is one member of the Monero project that is known to the public – Riccardo Spagni. However, he states that Monero could exist without him. On the one hand, anonymity is not a pleasant thing. But on the other hand, it is necessary even for those who would like to prohibit it. Given the geopolitical disunity of the modern world, it does not seem effective to ban a decentralized and anonymous crypto asset that can bring profit to investors and traders.
Monero strategists are already preparing for a situation of a possible delisting from centralized exchanges – they are developing atomic swaps for Bitcoin. This technology will make the delisting of coins from exchanges useless since the exchange of Monero for Bitcoin (and probably for Litecoin too) will occur programmatically. That is, it will be performed on a smartphone or laptop without the need for third parties. Nevertheless, they can’t ignore the risks, as these events can negatively affect the price of the coin in the short and medium term.
