Monero uses the PoW consensus algorithm. By May 2022, it is expected that 18.223 million tokens will be mined (currently 17 million in circulation), and then 0.3XMR will be issued per minute to continue to incentivize miners to maintain the security of the network. In the wild era (2014-2016) when there were not many anonymous currency competitors, Monero became more and more popular in the black market, from the initial market value of 5 million US dollars to the current 1.5 billion US dollars, an increase of 300 times.
Monero was launched on April 18, 2014. Its code was forked from the anonymous coin ByteCoin. Why did it fork? Because ByteCoin was not transparent enough, 80% of the tokens were pre-mined and held by a few people, which is one of the reasons why Binance delisted this coin. At the same time, the extremely poor code quality of ByteCoin caused extreme dissatisfaction among the perfectionists in the community.
The word Monero means "currency" in Esperanto. The name was chosen by community vote, expressing the community's original intention that Monero would become a universal anonymous currency in the world.
Monero uses the standard UTXO model pioneered by Bitcoin, rather than an account state configuration like Ethereum. Like Bitcoin, UTXO exists in the blockchain and is moved to a specified address when the user wants to spend it. Compared with Bitcoin's 1MB hard limit, Monero is dynamic in terms of block size cap and block rewards. The maximum block can be up to twice the middle block of the last n blocks. The protocol also maintains a minimum block size of 300KB, which means that miners can build blocks up to 300 KB without violating the rules.
Monero, on the other hand, follows a decreasing supply curve, with block rewards decaying over time. The key difference from many other cryptocurrency projects is that Monero has no limit on inflation. Once 18.132 million XMR are mined, there will be a "subsequent issuance" that will output 0.6 XMR every two minutes. The Monero community believes that unlimited inflation is necessary to incentivize miners to provide computing power to protect the entire network.
Monero uses the egalitarian CryptoNight hash function, a memory-intensive consensus system based on a proof-of-work mechanism. The marginal benefits of using dedicated circuits (GPU FPGA or ASIC) do not exceed the marginal cost of integrating such hardware. Therefore, Monero mining is often performed through traditional CPUs, allowing anyone with a general computer to find blocks equally, which means that the threat of computing power consolidation is greatly weakened, allowing the protocol itself to avoid centralization and other attack vectors.
