Key Reasons Monero Surge Continues Even as Bitcoin Bulls Take a Breather

Bitcoin's BTC$90,494.54 rally has paused above $100K, slowing the recovery rallies in major altcoins. But one coin stands resilient: monero XMR$374.55, the world's largest privacy-focused digital asset by market value.

XMR has risen 4.6% this week to $347, with prices gaining 2% in the past 24 hours, according to CoinDesk data. The cryptocurrency has outshone every other top 100 token by market value in the past 24 hours. Bitcoin, the market leader, has dropped 1.6% in the past 24 hours, taking the weekly decline to 2%.

Monero’s performance is even more impressive, considering its 110% recovery from the low of $165, hit during the early April sell-off when bitcoin dropped to $75,000. XMR's price charts had signaled the meteoric rise with a bullish golden cross a month ago.

The rally can be attributed to several factors, including a favorable regulatory outlook, according to HTX.

"In the U.S., the regulatory outlook has shifted as the FIT21 crypto legislation advances and the SEC shows increasing ambiguity in classifying certain tokens, easing market concerns over privacy coin regulation and prompting cautious capital inflows," analysts at HTX Research told CoinDesk.

The impending Full-Chain Membership Proofs(FCMP++) upgrade, a new and more powerful privacy feature integration, due later this year, may also be galvanizing investor interest.

"FCMP++ enhances Monero’s quantum resistance by providing forward secrecy, ensuring that a quantum adversary cannot break the privacy of past transactions even if they solve the ECDLP. By replacing ring signatures with full chain membership proofs, it eliminates vulnerabilities that quantum computers could exploit to deanonymize transactions," Monero society member @DatCryptoPiggie said on X.

Here is an analogy to help one understand the above. Imagine having a personal diary with a lock, but there's a risk of someone developing a super-smart device to crack the lock.

FCMP++ is likely an added layer of smart lock that will protect currency entries while ensuring that a potential entity managing to bypass the security tricks can't see past entries.

HTX also pointed to rumors of major exchanges looking to list XMR as a source of bullish pressure for the cryptocurrency.

"Rumors that major exchanges are considering relisting some privacy coins have further boosted sentiment," HTX analysts said. "Given their lower liquidity and concentrated holdings, privacy coins exhibit higher price elasticity than major cryptocurrencies, often resulting in more extreme price movements when capital enters the market."

Lastly, some observers have suggested that the recent suspected BTC theft of $330 million may have been laundered through XMR, leading to a bullish price action.

Read more: How $330M BTC Hacker May Have Doubled Down on Monero Derivatives