Wrapped monero has just been launched on the BTSE crypto exchange since the usage of privacy cryptocurrencies happens mostly on the darknet, but this service aims to change that. The ERC20 token could expand the use cases as we are reading more today in our latest Monero news.
Crypto exchange BTSE launched a wrapped Monero token a day ago according to a press release that we have in our XMR news today. This is a first of a kind token that is issued on the Ethereum network and each unit is backed by the actual Monero token. BTSE will mint and redeem the Wrapped Monero and will act as the custodian of the underlying Monero coin.
— BTSE (@BTSEcom) January 6, 2021
Monero is the world’s biggest privacy coin that has a market cap of $2.5 billion and it is an untraceable cryptocurrency based on “cryptonote” algorithm that masks the sender and receiver and their addresses. This is unlike BTC or ETH where the addresses can be observed and linked back to a certain user. With its features, Monero is the preferred cryptocurrency to transact on illegal marketplaces where it mostly enjoys its biggest use case. However, by issuing Monero on the ETH network as an ERC20 token, there are plenty of other benefits as well such as opening up the crypto to decentralized lending and trading. BTSE founder Jonathan Leong said:
“With this product, the value of XMR is further unlocked. Users don’t need to sell their Monero to buy erc20 tokens. They can simply wrap it, use it on the Ethereum blockchain, and then swap back to XMR whenever they want to.”
In the meantime, these benefits come at the cost of privacy. As an ERC20 token, Wrapped Monero will be afforded the amount of privacy that the ETH network has which means it is forgoing a criticial feature that buying Monero provided in the first place. This drawback could help the recent delisting spree of privacy crypto assets in the USA where coins such as Zcash and Monero fell victims to. Riccardo Spagni pointed out:
“Hey @BittrexExchange @BittrexGlobal @BittrexUS are you going to list wXMR? It’s traceable, so you should have no problem listing it.”
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