Bitcoin started as a symbol of the cypherpunk movement, aiming to provide a decentralized and private digital currency. Donald Trump becoming US President again has helped the Bitcoin price surge to an all-time high, but as bitcoin integrates into mainstream finance, there will be more scrutiny and regulatory oversight. Does this compromise the original vision of privacy and decentralization? Can Monero take bitcoin’s place? And has Monero been affected by Trump’s return?
Monero championing privacy
In contrast to bitcoin’s transparency, Monero (XMR) was created with privacy at its core. Launched in 2014, Monero uses advanced cryptographic techniques making transaction details (sender, receiver, amount) confidential. The focus on privacy has made Monero popular among users prioritizing anonymity.
Monero uses ring signatures to group a sender’s transaction with several others, making it difficult to identify the sender. Unique, one-time addresses (stealth addresses) are created for each transaction, meaning only the sender and receiver know the destination.
Ring Confidential transactions (RingCT) hides the transaction amount for another layer of privacy.
Privacy vs. regulation
Monero’s privacy features have sparked debate about the balance between users’ privacy and regulatory oversight. Some view Monero as a tool for protecting privacy but others have expressed concern about its potential misuse in illegal activities.
Investopedia says that the anonymity of Monero has “made it attractive for individuals and entities engaged in drug trafficking, gambling, hacking, and other illicit activities.”
Its privacy features make it difficult for law enforcement to identify suspects.
Is it legal to own Monero?
US citizens can own Monero legally. Other countries have banned exchanges.
Does both bitcoin and Monero flourishing serve Nakamoto’s vision?
Boaz Sobrado, writing for Forbes, recently argued that the diversification in cryptocurrencies serves the original vision of Satoshi Nakamoto (creator of Bitcoin).
“What began as a single challenge to state monetary control,” writes Sobrado, “has evolved into a multi-faceted movement, with different cryptocurrencies confronting the monopoly of state money from various angles.”
Bitcoin is now acting as “a bridge” between crypto enthusiasts and traditional finance, while Monero is serving the original cypherpunk philosophy of private, uncensored currency.
Sobrado argues that the “goal of creating alternatives to state money was perhaps too complex, too multifaceted” for bitcoin to achieve alone. The divergence between bitcoin and Monero, he says, is a “natural and necessary evolution”, rather than a dilution of Nakamoto’s vision.
Monero vs. Bitcoin
One major difference between the two currencies is that all bitcoin transactions can be traced to their origin.
Montero transactions are “virtually impossible” to link to a “specific sender or recipient”, as per Investopedia.
Montero can handle more transactions per second than Bitcoin, making it more scalable.
Has Monero’s price changed recently, along with bitcoin?
Trump’s support of bitcoin has meant an all-time high of over $109,000 coinciding with his return to the White House. Nina Bambysheva wrote for Forbes, “Trump has quickly become the crypto world’s new best friend, snagging donations from Circle, Ripple and other large companies for his inaugural committee. They’re even throwing a “Crypto Ball” in D.C. on Friday [24 January], a sign that the industry’s influence on Capitol Hill has never been stronger.”
In January, Polymarket’s odds of Trump establishing a national bitcoin reserve in 2025 rose to 65% from 39%.
Solana also reached a new record high of $275 on 19 January. On January 22 it closed at $256.79. Crypto.news reported that the coinciding surge in volume ($19.47 billion on January 19) happened “because of the recent launch of the Official Trump meme coin that launched on Friday, Jan 17.”
Monero’s price has been less affected by Trump’s return. It increased in January, closing at $230.69 on January 17, but has since dipped. The price of over $200 is good news for supporters though, and the highest it has been since the spring of 2022.
Monero’s all-time high was a year earlier, when it closed at $421.89 in April 2021.
Will Trump’s presidency mean a booming economy?
Harvard economist Ken Rogoff recently told Yahoo, “I don’t think we’re going to see the boom that we saw in the first time”.
Rogoff says Trump’s policies aim to support the currently strong economy, and while he doesn’t foresee a recession, he expects growth to slow in the second half of Trump’s term.
Others have been less optimistic about the overall picture. BBC reported the director of budget and entitlement policy at the Cato Institute, Romina Boccia, saying, “There’s no clear path forward at this time for how to meet all these goals because they’re inherently contradictory”.
Economist John Cochrane has said Trump has to manage the “tension” between the pro-business parts of his coalition with the “nationalists” concerned about border control and the rivalry with China.
Natalia Sherman, business reporter in New York writing for BBC, said Trump’s “most unorthodox economic promise” was to place tariffs of 10% or more on all goods entering the US – and more than 60% for goods from China.
Analysts have said such tariffs will likely mean higher prices for Americans and trouble for companies affected by other countries’ retaliation.
Michael Cembalest of JP Morgan Asset Management recently said, “They’ve got a very limited margin for error”, warning against a major overhaul that could “break something”.
