For this week’s feature about the best performing token for the last 7 days (as reported in our Weekly Recap), we will quickly go over Monero Classic, the resulting token of the hard fork the Monero chain experienced in the later months of 2019.
Differing Ideas
Starting its operations in 2014, Monero is a cryptocurrency focused on fungibility, privacy and decentralization, based on a Proof-of-Work algorithm and an obfuscated public ledger, where every user is able to broadcast and perform transactions, but users outside of the network cannot access information about the source, destination or amount of said transactions.
The project worked as intended, with the XMR token being widely used among the crypto community, but security concerns were increasing within the team as time went on up until the chain reached a block height of 1,546,000, which occurred last year and triggered a hard fork of the network, where the resulting new token would implement a new PoW algorithm in order to protect itself against application-specific integrated circuits (ASIC). This new token is Monero Classic (XMC).
Setting up the Defenses
By creating a consensus algorithm that relies heavily on random code execution (RandomX) and memory focused techniques, Monero Classic is one of the first chains to prepare themselves for technological advancements in mining hardware. The new blockchain is, allegedly, also well-optimized to be run on CPUs instead of GPUs only, making the network more accessible to non-specific machines.
What the Monero Classic team believes is that, as the cost of ASIC machines increases, it may generate a centralizing effect with less users being able to maintain an effective node in the network, eventually leading to entire chains being upheld entirely by wealthy organizations. In situations like this, the best course of action is to take preventive measures, hence the hard fork that took place, but some may not think of ASIC machines as much of a threat.
Bran Cohen, author of the BitTorrent protocol, believes that anti-ASIC measures are counterproductive and that they all eventually fail, which generates a bounce back towards centralization around ASIC manufacturers when they do. Vitalik Buterin, co-founder of Ethereum, also defends that these measures have a limited lifespan, and that the failure point ends up generating great vulnerability to ASIC attacks, which become cheaper.
However, the XMC coin managed to increase greatly in its value during last week, meaning that they are generating waves of positive sentiment that draws in people to purchase and trade tokens. It is certainly too soon to talk about stable growths or market disruptions, but keeping an eye of the token can be highly rewarding with little to no effort.