Monero (XMR) Rally Amid Bans: Mining, On‑chain Demand and Concentrated Supply
Monero (XMR) surged to an all-time high above $690 on Jan 13, 2026, up about 262% from ~ $200 a year earlier despite intensified regulatory pressure and delistings by major centralized exchanges. PANews analysis finds on-exchange spot and derivatives volumes did not show a corresponding surge: recent spot volumes largely stayed between tens of millions and $200M, with the contract-volume peak occurring on Nov 10. Open interest rose mostly because price increased, not from massive new positions, suggesting exchanges are not the primary price-setting venue.
Supply-side signals point to miner-driven dynamics: Monero mining difficulty climbed sharply from late 2024 through 2025, with volatility after a September 2025 51% hashpower claim by Qubic that triggered an 18-block reorganization and miner migration to SupportXMR. That episode and subsequent difficulty/reward shifts indicate consolidation of mining power and early accumulation by resilient large miners.
Demand-side evidence includes rising average on-chain fees: fees moved from < $0.1 historically to peaks above $0.3 by Dec 11, 2025, implying increased urgency for transactions. Fee spikes often coincide with price jumps, showing a feedback loop between real chain usage and market sentiment.
PANews frames the rally as having two sides: a "white" side—real privacy demand strengthened by regulatory limits (e.g., VARA’s Dubai ban on privacy-coin trading and custody)—and a "black" side—information asymmetry and concentrated capital enabling outsized moves with limited transparent volume. For traders, that combination creates high volatility and potential for sharp drawdowns as seen in prior privacy-coin spikes (e.g., ZEC).
Bullish
The article supports a bullish classification because the rally is backed by on-chain demand growth (rising average fees) and supply-side consolidation (increasing mining difficulty and miner accumulation). These fundamentals—real transaction usage and concentrated mining commitment—can sustain price appreciation beyond mere exchange-driven speculation. Regulatory bans paradoxically reinforced demand for privacy features, reducing exchange liquidity but redirecting activity on-chain and among non-exchange venues. However, the article also warns about concentrated information/position risk and limited transparent volume, which increases short-term volatility and the possibility of sharp corrections (as seen with past privacy-coin spikes like ZEC). For traders: expect continued upward bias driven by fundamentals and regulatory-driven demand, but prepare for high intraday and short-term drawdown risk. Use smaller position sizes, tighten risk controls, and watch on-chain fee trends, mining difficulty, and large wallet movements to time entries and exits. In the long term, sustained adoption of privacy transactions and stable miner commitment would remain bullish; if regulatory enforcement escalates into protocol-level restrictions or major liquidity providers exit, downside scenarios could dominate.