Monero, a blockchain that touts near-untraceable transactions, saw its XMR token hit an all-time high amid mounting investor interest in privacy-preserving crypto.
The token, which is popular with privacy enthusiasts and darknet marketplace users, jumped to $596 on Monday, 10% above its previous high of around $542 set in 2018.
The reason for Monero’s growing adoption? Investors are realising that financial privacy, once an afterthought, is quickly becoming more important than ever, Riccardo Spagni, former lead maintainer of Monero, told DL News.
“There’s a global shift towards a recognition that privacy is instrumental and critical to us as individuals and as a civilisation,” he said. “For an eternity we’ve allowed increasingly dystopian systems to exist, and it’s clear that we need to take that back.”
The privacy fervour can be felt all across the $3.1 trillion crypto industry.
In October, developers behind Ethereum made embedding privacy into the $376 billion blockchain a key focus.
Zcash, a blockchain that gives users the option to conceal their transactions, has seen its ZEC token skyrocket some 700% over the past year. To be sure, ZEC fell roughly 18% over the past week amidst ongoing drama at Electric Coin Company, the organisation behind the privacy project.
The hype even extends to institutional investors, many of whom view blockchain privacy as a prerequisite for mass adoption. Andreessen Horowitz’s crypto arm, Galaxy Digital, and Gemini founders Cameron and Tyler Winklevoss have all made privacy-preserving crypto technologies a chief concern in recent months.
Why Monero?
Launched in 2014, Monero is among the oldest cryptocurrencies to still see significant use today.
The blockchain keeps transactions private and untraceable by default using a cryptographic tool called Ring Signatures. When a user sends Monero, their transaction is mixed with other decoy outputs, forming a ring. Observers see a group of potential senders but can’t tell which one is which.
The ability to conceal transactions has made Monero popular with privacy advocates.
They argue financial privacy offered by Monero and other similar crypto assets should be considered a fundamental human right, similar to using cash or encrypted communication.
“The average person needs to take their privacy seriously sooner rather than later,” Seth, the vice president of operations at Cake, a Monero-enabled crypto wallet, told DL News. He did not give his full name to protect his anonymity.
Seth cited global financial crackdowns, invasive know-your-customer and anti-money laundering requirements, and the prosecution of privacy developers like Tornado Cash’s Roman Storm as reasons blockchains like Monero are seeing increased interest.
Additionally, proponents say the privacy offered by Monero helps protect users against surveillance from criminals and government censorship.
Over the past year, so-called wrench attacks targeting crypto investors have surged. Here, criminals kidnap investors and use threats of violence and torture to force victims into revealing the passworld-like private keys that grant access to their crypto wallets.
The perpetrators of such attacks often use publicly-accessible blockchain records to find crypto rich targets.
Regulatory pushback
Yet at the same time, Monero’s XMR is also the crypto of choice among many criminals.
In October 2024, Japanese authorities arrested 18 people for laundering money using Monero. In 2022, a US nuclear engineer and his wife were caught attempting to sell secret nuclear propulsion technology to a third country. The pair requested payment in XMR.
The XMR token is also used as the primary currency across several darknet marketplaces, where users buy and sell drugs and personal data obtained through hacks and data breaches, among other things.
It’s these uses of Monero that have attracted scrutiny from regulators in multiple jurisdictions.
A ban on privacy tokens like Zcash and Monero from Dubai’s financial regulator came into effect on January 12. The regulator cited anti-money laundering and sanctions compliance risks in the decision.
In 2024, the European Parliament voted through a bill that will ban listing tokens like Zcash and Monero. The argument was that the EU wanted to fight financial crimes such as money-laundering.
The new EU rules are set to snap into action in 2027.
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.
