Yesterday, the "ancient" privacy coin Monero ($XMR) suddenly exploded after being silent for a long time. It soared 30% in a single day, and the price rose to $329, setting a new high since 2021. What is this 11-year-old coin? And why did it suddenly soar?

The most OG privacy coin

In 2013, Nicolas van Saberhagen published the "CryptoNote" protocol. Monero was born on this basis in April 2014 and switched to RandomX in 2019.

Monero uses technologies such as ring signatures, stealth addresses, and RingCT to hide the sender, receiver, and amount of transactions. This high degree of anonymity gives it an advantage in privacy protection, and Monero's modular code structure has been praised by Wladimir J. van der Laan, one of the core maintainers of Bitcoin.

But while maintaining privacy, it also makes it difficult to meet the regulators' anti-money laundering (AML) and counter-terrorist financing (CTF) requirements. As one of the most well-known privacy coins, it is a coin with two sides. On the one hand, its focus on privacy, decentralization, and scalability are loved by many people who love "liberalism", but on the other hand, it has become a hotbed for criminals.

Criminals' "Favorite"

At the end of the summer of 2016, with the arrest of Ross William Ulbricht, the founder of "Silk Road", the police department mastered the traceability technology of Bitcoin in the long struggle. Major dark web markets such as AlphaBay began to abandon Bitcoin and adopt Monero, which is more difficult to trace. North Korea's hacker group Lazarus Group also likes to use Monero to "launder" assets, which made Monero usher in its first market value breakthrough in 2016 "from 5 million US dollars to 185 million US dollars" and rapid growth in transaction volume.

2020 is the second hot period of Monero. This year, the terrorist organization ISIS updated its website, showing that it no longer accepts Bitcoin donations and changes to the more private token Monero. The reason is that if ISIS's Bitcoin reserves are too large, it may be difficult for the terrorist organization to transfer or cash them out. This is also confirmed by a report from Chainalysis, which states that ISIS holds less than $100,000 in Bitcoin, and most other terrorist organizations are in a similar situation. In the same year, sales in the dark web market increased by 70% year-on-year. Monero became one of the main payment tools due to its privacy characteristics, accounting for 45%, almost on par with Bitcoin.

Dark web transactions, fraud, ransom for kidnapping, and exit paths for hackers to steal coins, it can be said that Monero is notorious, with the large-scale adoption of "underground transactions". In 2020, the token price of XMR also rose from $50 at the beginning of the year to $150 by the end of the year, and reached $450 by mid-2021.

Key to Freedom

Although Monero has long been associated with "crime", it is only a technical tool. The Monero development team has always adhered to the position of "code neutrality". They emphasize that "Monero is designed for everyday use by ordinary people, and any technology may be abused, such as cash." They do not cooperate with criminal acts, nor do they have any connection with criminal organizations.

Therefore, from another level, it implements Bitcoin's "freedom of transaction" and is deeply supported by many geeks who support the spirit of "liberalism", "privacy first", and "decentralized anti-censorship". Many people in the community believe that it is the real Bitcoin.

John McAfee, who founded the first antivirus software McAfee, is one of them. "Monero is one of the truly anonymous cryptocurrencies, while Bitcoin is not truly anonymous." He expressed his recognition of Monero's technical strength and privacy characteristics on many occasions during his lifetime. The anonymity and untraceability of Monero are highly consistent with the "privacy liberalism" concept that McAfee has long advocated.

Even "Bitcoin Jesus" Roger Ver "rebelled". In his first public interview after Roger was released on bail in 2024, he said that he decided to give up Bitcoin and instead favored tokens such as Monero that can provide more privacy. "Most people today use custodial wallets, which are not actually wallets at all, but just an account, and the privacy is no higher than your account at Bank of America or Paypal. But fortunately, there are other cryptocurrencies such as Monero that can provide more privacy protection."

In areas where cryptocurrencies are active, some e-commerce or independent merchants will accept Monero as a payment method, such as some technology-related online stores "hardware wallets or cryptocurrency peripheral technology products" or offline retail stores, and community member Schmidt also posted his receipt for buying low-fat organic cocoa drinks at Spar with Monero.

Note: SPAR is one of the world's largest food retail chains, founded in 1932 by Adriaan van Well in the Netherlands. It has more than 13,900 stores in 48 countries. The Kreuzlingen store purchased by the community member is located in Switzerland and has attracted much attention for accepting cryptocurrency assets such as Bitcoin and Monero.

When the comment section evaluated Monero as a cryptocurrency used for "money laundering", the well-known on-chain detective ZachXBT retorted, "No, I often use Monero to pay", which shows that he is also one of the Monero enthusiasts.

Short-term Pump or Value Discovery?

Stolen funds flow in

Chain detective ZachXBT posted on social media that "nine hours ago, a suspicious transfer of 3,520 bitcoins (about $330.7 million) occurred to a certain address. These funds were then laundered through more than 6 instant trading platforms and converted into Monero, causing the price of Monero to soar by 50%."

This also caused a large number of short contracts on the token to be closed, and traders were forced to buy back assets, further increasing upward pressure on the basis of growing spot demand. These common factors may have created Monero's recent sudden rise.

Project progress is good

Some analysts believe that the growing expectations for Monero's EP159 and EP160 upgrade proposals are also one of the factors for this rise. The proposal can make Monero more compliant and friendly, allowing users to provide proof of transaction validity without exposing sensitive private information. The community believes that this upgrade may allow Monero, which has been delisted from major CEXs since the EU updated its anti-money laundering regulations in 2024, to be relisted on compliant top CEXs such as Binance and Coinbase.

In addition, the first DeFi project Tari will soon appear in the Monero ecosystem. The project plans to merge mining with Monero and launch the mainnet on May 6. Many people in the Monero community are looking forward to the emergence of this project.

When the tool was created, the concept of good and evil gave it more meanings. Monero is like a microcosm of current cryptocurrency, weighing between "freedom" and "regulation", and wandering between "human rights" and "crime". The kindness and evil of human nature are infinitely magnified here, just like what Einstein said when commenting on the atomic bomb: "Science and technology are a double-edged sword. It can benefit mankind, but it can also destroy the world."