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Monero has suffered a sharp reversal, plunging nearly 20% in a week and 41% from its Jan. 14 all-time high of $797.
Outpacing the Altcoin Slump
The privacy coin Monero ( $XMR) is currently locked in a punishing downtrend, a stark reversal from the euphoric heights of Jan. 14, when it notched a new all-time high of $797. In a swift 24-hour liquidity drain, $XMR plummeted 9.5% to $463, effectively incinerating the massive gains realized during its mid-month rally. This latest leg down brings the digital asset’s seven-day losses to nearly 20%, resetting its price action to pre-Jan. 10 levels.
While the broader crypto market is feeling the chill, Monero’s descent has been disproportionately steep compared to its peers. For perspective, Zcash ($ZEC), which has had a rocky start to 2026, dipped a modest 3.1% on Jan. 25 and 8.6% over the week. At a price of $357, $ZEC maintains a market cap of $5.9 billion—trailing Monero’s valuation by nearly $2 billion, even after $XMR’s recent haircut.
The ‘ZachXBT Effect’ and Criminal Liquidity
The catalyst for Monero’s rapid ascent—and its subsequent crash—appears tied to illicit flows. Market sentiment soured after prominent on-chain sleuth ZachXBT linked $XMR’s initial surge to cybercriminals aggressively swapping $285 million in stolen digital assets for the privacy coin. This “laundering-induced” demand created an inorganic price spike that analysts warned was unsustainable. Once the laundering cycle peaked, the buying pressure evaporated, leaving retail holders to catch the falling knife.
Read more: Monero Stalls Post-ATH: How a $282M Social Engineering Scam Fueled $XMR’s Rally
The technical breakdown was further catalyzed by a fundamental blow on Jan. 23. The Indian Financial Intelligence Unit (FIU) reportedly issued a directive instructing exchanges to restrict transactions involving privacy-focused assets, specifically targeting $XMR, $ZEC and DASH. Citing heightened risks of money laundering and terrorism financing, Indian authorities have effectively tightened the noose on privacy coin liquidity.
This move marks a growing geopolitical trend; India now follows the United Arab Emirates, which implemented similar restrictions on Jan. 12. As major economies move to de-list or restrict “dark” assets, Monero faces a dual-threat environment: waning speculative interest and an increasingly hostile regulatory landscape.
FAQ ❓
- Why is Monero ( $XMR) dropping? $XMR plunged after illicit flows and regulatory crackdowns drained liquidity.
- How steep is the decline? Monero fell nearly 20% in seven days, erasing mid‑January gains.
- What role did regulators play? India’s FIU restricted privacy coin transactions, echoing UAE’s earlier ban.
- How does this compare to peers? Zcash dipped just 3.1%, showing Monero’s losses are disproportionately severe.