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Monero’s XMR Token Hits Eight-Year Low Against Bitcoin
Monero, a privacy-focused blockchain network, has seen its XMR token drop to the lowest level against Bitcoin in the past eight years. Regulatory pressures on privacy-focused cryptocurrencies have contributed to this decline.
According to CoinMarketCap data, the XMR-BTC chart hit a low of 0.001954 BTC recently, marking a significant 50% decrease on a year-to-date basis. Additionally, the US dollar value of the digital asset has also faced challenges, plummeting by more than 20% over the past year to less than $120 currently.
Monero Developments Amid Regulatory Challenges
Despite these setbacks, Monero developers are actively working to enhance the network’s privacy features in the face of regulatory obstacles. A recent announcement on the Monero website introduced a new privacy mechanism called “Full-Chain Membership Proofs (FCMP),” which aims to replace the current Rings system.
The Rings system, while effective at securing sender privacy, has been plagued by vulnerabilities such as EAE attacks, chain reorganization issues, and susceptibility to statistical analysis. In contrast, FCMP is designed to eliminate these risks and ensure comprehensive user anonymity. The official statement regarding FCMP reads:
“Full-Chain Membership Proofs prove the output spent is one of any output on the chain, effectively removing all of these risks. This means every input goes from an immediate anonymity set of 16 to 100,000,000.”
Two main proposals have emerged for implementing FCMPs. The first proposal is set to align with the upcoming Seraphis upgrade, with a focus on enhancing efficiency and privacy through customized proofs. The second proposal, developed as a response to spam attacks, introduces features like transaction chaining, outgoing view keys, and forward secrecy independently from Seraphis.
Privacy Challenges in the Crypto Space
Monero’s efforts to strengthen its network come at a time when regulatory scrutiny on privacy-focused crypto tools is intensifying. US Treasury Deputy Secretary Adewale Adeyemo recently highlighted the misuse of anonymity-enhancing tools like mixers by terrorist organizations and rogue states like North Korea to obfuscate the origins of illicit digital assets.
In line with regulatory compliance efforts, the US government has taken legal action against the developers of Tornado Cash, a crypto-mixing service. Additionally, the authorities arrested the co-founders of Samourai Wallet, a privacy-focused service provider, for allegedly running an unlicensed money transmission business.
As a result of these developments, several cryptocurrency platforms such as Binance and OKX have delisted privacy-focused digital assets from their offerings to adhere to evolving regulatory standards. Despite these challenges, key figures in the crypto space like Ethereum co-founder Vitalik Buterin continue to advocate for the industry’s legitimacy and innovation.
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