Date Launched: April 18, 2014
Founders: Nicolas van Saberhagen
Parent Code Fork: Bytecoin
Child Code Fork: Aeon, Sumokoin, BipCoin
Monero is a privacy coin that is secure, private, and untraceable. Unlike Bitcoin, the mining rewards never fall below 0.3 MNR. Monero uses ring signatures, ring confidential transactions, and stealth addresses to obfuscate the origins, amounts, and destinations of all transactions.
Monero is Fungible
Fungibility means that two units of a currency can be mutually substituted. For example, two $10 bills are identical in value and are functionally identical to any other $10 bill in circulation (although $10 bills have unique ID numbers and are therefore not completely fungible). Gold is a close example of true fungibility, where any 1 oz. of gold of the same grade is worth the same as another 1 oz. of gold. Monero is fungible due to the nature of the currency, which provides no way to link transactions together nor trace the history of any particular XMR. 1 XMR is functionally identical to any other 1 XMR.
Fungibility is an advantage Monero has over Bitcoin and almost every other cryptocurrency. Monero is inherently private whereas Bitcoin transactions are permanently traceable on the blockchain. With Bitcoin, any BTC can be tracked by anyone back to its creation. Therefore, if a coin has been used for an illegal purpose in the past, this history will be contained in the blockchain in perpetuity.
Bitcoin’s lack of fungibility means that certain businesses will be obligated to avoid accepting BTC that have been previously used for illegal purposes, or simply run afoul of their Terms of Service. Currently some large Bitcoin companies are blocking, suspending, or closing accounts that have received Bitcoin used in online gambling or other purposes deemed unsavory by said companies.
Why Monero is different
Monero is secure
Monero is a decentralized cryptocurrency, meaning it is secure digital cash operated by a network of users. Transactions are confirmed by distributed consensus and then immutably recorded on the blockchain. Third-parties do not need to be trusted to keep your Monero safe.
Monero is private
Monero uses ring signatures, ring confidential transactions, and stealth addresses to obfuscate the origins, amounts, and destinations of all transactions. Monero provides all the benefits of a decentralized cryptocurrency, without any of the typical privacy concessions.
Monero is untraceable
Sending and receiving addresses as well as transacted amounts are obfuscated by default. Transactions on the Monero blockchain cannot be linked to a particular user or real-world identity.
Monero is fungible
Monero is fungible because it is private by default. Units of Monero cannot be blacklisted by vendors or exchanges due to their association in previous transactions.
Since Monero is untraceable, government agencies have often associated it with illegal activities. When two major illegal markets, Alphabay and Hansa, were taken down by government officials, a large number of cryptocurrencies were confiscated. While the amount every other coin (including Bitcoin, Ethereum, etc.) could be tracked, the Monero could not be found. This led to a major celebration in the Monero community, as it finally validated the privacy function of the coin.