What Is MonaCoin?

MonaCoin, or MONA, is a digital currency created in 2013. It is predominantly used in Japan. It was launched in 2013 as part of the MonaCoin Project. It is named after "Monā" or "Mona," an Internet meme based on a cat-like figure created using ASCII characters that were popularized on the online community 2channel (or 2chan), which serves as a major information hub for technology enthusiasts. Development of the currency was also announced over 2han.

The cryptocurrency was the brainchild of an anonymous “Mr. Watanabe,” who—like Bitcoin’s Satoshi Nakamoto—has never been incontrovertibly identified.

As of March 2021, 1 MONA token trades for around US $1.85, with an aggregate market value of around $134 million.

Key Takeaways

  • MonaCoin is a blockchain-based cryptocurrency system predominantly used in Japan.
  • It was launched in 2013 by an anonymous developer Mr. Watanabe.
  • It creates blocks faster than Bitcoin and has been approved by Japan's regulatory authorities for use in daily transactions.

Understanding MonaCoin

The algorithm that powers the cryptocurrency is called Lyra2RE(v2), and the currency itself is a fork of Litecoin. New coins are issued as payment for mining activities, which allows the ownership of tokens to be recorded into the MonaCoin blockchain. MonaCoin has an average block creation time of 1.5 minutes, a time that is much faster than Bitcoin's 10-minute block creation time.

Processing a block of transactions results in an award of MONA, with the amount of coin awarded for mining activities set to halve approximately 1 million blocks (an estimated three years). The total number of coins that will be ultimately made available is 105,120,000, and no coins were “pre-mined” before becoming available to the public. As a result, the initial developers are not expected to make a profit because no mining activities would be conducted in the early stages.

MonaCoin in Japan

MonaCoin bills itself as the first Japanese cryptocurrency, and is predominantly used in Japan. MonaCoin is accepted as payment by several stores, both online and physical, and is also traded on several digital currency exchanges. MonaCoin has been approved by Japan's Financial Services Agency and has been added to several exchanges. As with other cryptocurrencies, becoming available on more exchanges tends to increase transaction volumes.

MonaCoin has smaller trading volumes than Bitcoin and Ethereum. This partially due to its novelty, as well as its concentration in Japan. It is most frequently used through third-party mobile applications to provide tips, including in online games. The currency can be stored in and exchanged through Monappy, an online platform where MonaCoin holders can exchange coins for digital assets, such as coupons, electronics, and other items. The Monappy website also features online game streamers that accept MonaCoin as tips. MonaCoin can also be stored in third-party e-wallets.

Speculation as to why MonaCoin was created often focuses on a cultural desire in Japan to create a national version of well-known products. This desire is borne out of people wanting products and services that they feel they can relate to, both in terms of being created in Japan as well as having documentation and other content written in Japanese. Despite its strong association with Japan, MonaCoin is not designed to be a national cryptocurrency, such as Iceland’s Auroracoin.

The adoption and use of cryptocurrencies have been much easier in Japan from a regulatory standpoint and cryptocurrencies are considered a legal method of payment. Japan has a relatively high number of “smart” automatic teller machines (ATMs) capable of handling cryptocurrency trading.