SoFi

Yes. The main point of a refinance is to get a lower rate, and graduates who qualify can save serious money.

Interest Rate, Explained

An interest rate is the rate charged to borrow money. Interest is calculated as a percentage of the unpaid principal amount. Federal student loans have a fixed rate, while many private student loans have a fixed or variable rate.

Student loans generate interest daily. Lenders typically add the accrued interest to the balance each month when the bill is generated.

The interest rate paid on any loan may make a big difference. If you have $75,000 in student loan debt and 20-year repayment term, the difference in interest paid with a 6.5% rate and a 4% rate is over $25,000.

To refinance student loans, people with excellent credit and a healthy income — or a solid cosigner — will generally qualify for the lowest rates.

Lowering Your Interest Rate With Consolidation vs Refinancing: How They Differ

For Federal Student Loans

Consolidation is a term reserved for federal student loans and is different from refinancing. Student loans are combined into one loan with a longer term (up to 30 years), reducing the monthly payments. The rate is the average of the existing loans’ rates, rounded up to the nearest one-eighth of one percentage point.

Opting for a Direct Consolidation Loan allows borrowers to retain access to federal programs like deferment, forbearance, and income-driven repayment plans.

But because the new interest rate is the average of the existing rates, rounded up a hair, consolidating loans and drawing out the term usually results in more total interest paid.

Normally, if you had started paying toward Public Service Loan Forgiveness and then consolidated your loans, you’d have to start your qualifying payments over. But a waiver through October 31, 2022, will count repayment on loans before consolidation.

For Private Student Loans

Refinancing means paying off your private or federal student loans with one new loan with a new rate and, sometimes, term.

Refinancing with a private lender may lead to substantial savings.

Then again, it might not be the right move for every borrower. For those with federal student loans, refinancing means losing access to federal student loan forgiveness and income-driven repayment plans.

But borrowers with higher-interest student loans may find the allure of a lower rate — fixed or variable — tempting. If you qualify, you could reduce your payments or save a lot on total interest paid.

Recommended: Can Refinanced Student Loans Still Be Forgiven?

Understanding Your Options to Lower Interest Rate

Federal student loan consolidation is meant to make your monthly payment more manageable by lengthening your repayment term, but it will not lower your rate.

Only by refinancing with a private lender can you try to lower your current private or federal student loan rates. This student loan refinancing calculator can give you an idea of how much you could save by refinancing.

Before you start browsing interest rates, take a look at your current loans. How much do you owe? What are the rates? Are you enrolled in any federal benefits, eligible for any, or hoping to be?

Having this information at the ready can provide valuable insights as you start comparing the rates and terms you might qualify for from different lenders. A rate quote is usually quick and entails only a soft credit pull.

After you’ve determined how much you could potentially save by refinancing, consider looking at other benefits offered by the lender.

Refinancing With SoFi

Refinancing student loans to a lower interest rate makes sense for borrowers who are able to do so and who don’t qualify for or need income-driven plans or other federal programs.

SoFi offers student loan refinancing with low fixed or variable rates, as well as access to member benefits at no cost.

There are no fees when you refinance with SoFi, and the application process can be completed online. If you’re ready to take the next step in paying off student debt, get a rate quote in two minutes.

FAQ

What is federal student loan refinancing?

If you refinance federal student loans, a private lender pays them off with one new private student loan that ideally has a lower rate. Federal student loan consolidation is different.

Do low interest rates apply to student loans?

Federal Direct Subsidized and Unsubsidized Loans for undergraduates have a fairly low fixed rate for all borrowers. The rate for Direct Unsubsidized Loans for graduate and professional students is higher. The rate for Direct PLUS loans, for graduate students and parents of dependent undergrads, is yet higher. Most federal student loans also have loan fees that are a percentage of the total loan amount. The fee for PLUS loans has run over 4% in recent years.

Private student loan rates generally are higher than federal student loan rates, but refinancing rates may be quite low for those who qualify. There’s never any cost to refinance, and you can do so as many times as you want.

Can you refinance a student loan for a lower interest rate?

Yes, if you qualify to do so.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

If you’re like most borrowers, particularly those with six figures’ worth of student loans from graduate or professional school, you might find that looking at your student debt square in the face is a downer, but repayment can be managed.

Is refinancing a good idea? It can be. When? When you can snag a lower interest rate and in a few other situations.

Student Loan Repayment Plans

Chances are you set up a student loan repayment plan after graduation and figured you’d revisit it later — when you’re making more money, when your career is more secure, when you have more time. The standard repayment plan for federal student loans is 10 years. Direct Consolidation Loans have a repayment period of 10 to 30 years.

Putting off the repayment thought is understandable. After receiving your undergraduate or graduate degree, your focus is on other things (like building a career).

But if you let that nebulous “later” turn into “never,” the repercussions can be costly. At some point, refinancing your student loans could potentially save you a significant amount of money. You just need to figure out if it is the right move for you.

When to Finance Your Student Loans

1. Your Current Student Loans Have High Interest Rates

Look at the interest rates you’re paying on your student loans, particularly federal Direct Unsubsidized Loans (graduate or professional), federal grad PLUS loans, and/or private student loans.

Depending on how high your loan balance is and how much you could reduce the interest rates by refinancing one or more loans, your cost savings may be significant.

2. Your Financial Situation Has Improved Since You Took Out the Loans

Maybe you were a starving student when you took out federal or private student loans, but ideally your financial situation has improved with time. This is great news for your bottom line, because a higher credit score and income help a borrower qualify for lower interest rates.

If you expect to stay on an upward financial trajectory, you might even consider refinancing to a variable-rate student loan, which will have a lower starting interest rate than a fixed-rate loan. Variable rates are tied to market fluctuations, though, which means rates that are very low today are likely to go up at some point.

The upshot is that a variable-rate loan could be a good option for a qualified borrower who intends to pay off the loan at a relatively fast pace.

3. You Don’t Plan to Use Certain Federal Student Loan Benefits

Borrowers who go to work in the public sector may qualify for the Public Service Loan Forgiveness program. Some federal programs also offer relief for borrowers who experience financial hardships (such as student loan deferment and forbearance, income-driven repayment plans, and the graduated repayment plan).

If you expect your income to be unpredictable or you’re looking into qualifying public service employment, it probably wouldn’t behoove you to refinance federal student loans. But refinancing could make sense if you don’t plan to tap into any of the federal programs listed above and you can gain a lower rate.

Recommended: Looking for more guidance on your student loans? Explore SoFi’s Student Loan Help Center for tips, resources, guides, and more!

4. You’re Going to Take Out a Large Loan

For loans like mortgage loans, lenders will look at your debt-to-income ratio, among other things. DTI is your monthly debt payments per month, including your future mortgage payments, divided by your gross monthly income. A low DTI generally signals better odds of loan approval and better interest rates.

Decreasing your monthly student loan payment by refinancing, with, say, a long loan term, could lower your DTI.

It might make sense to refinance your student loans at least six months before buying a home or making any other large purchase. That will give you time to recoup the points lost after a hard credit inquiry.

Once the mortgage or other big loan has been secured, you could refinance again, this time picking the lender offering the lowest rate, not just the lowest payment. You can refinance student loans as many times as you wish.

If you think student loan refinancing may be a good option for you, the next step is to check out several refinancing providers to compare interest rates and other features.

Refinance Student Loans With SoFi

You can refinance both federal and private student loans into one new loan with SoFi in an easy, all-online process. You can get your rate in two minutes.

SoFi also offers access to an extensive member network through complementary member experiences like happy hours and dinners.

Which means you could gain more than cost savings when you refinance student loans.

FAQ

When should I refinance my student loans?

It might make sense to refinance as soon as you have a stable income and good credit that can usher in a lower rate.

Can I refinance student loans after buying a house?

Buying a home creates new debt, and that can make refinancing student loans more difficult. But by waiting several months or even a year to refinance, the dust can settle on the mortgage decision.

Is refinancing my student loans a good idea?

If you’re struggling to repay federal student loans, you might consider an income-driven repayment plan or federal student loan consolidation.

But if you can qualify, your income is stable, and you would save money by refinancing federal or private student loans, that might be a smart move.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

Considering the average published college tuition according to The College Board ranges from $3,800 for a public two-year institution to $38,070 at private nonprofit four-year institutions, college students need all of the financial help that they can get.

One option is to use scholarships, which are a form of financial aid awarded to students to help pay for tuition and other education expenses. Unlike student loans, scholarships don’t need to be repaid.

Below, you’ll find the answers to “what is a scholarship?” as well as where to get a scholarship and the different types of scholarships that may be available to you.

What Is a Scholarship?

A scholarship is a form of financial aid that’s awarded to students to help pay for school. Over the last 10 years, the number of scholarships awarded has increased by 45%, according to the National Scholarship Providers Association (NSPA). Each year, there’s an estimated $46 billion in grants and scholarship money awarded by the U.S. Department of Education, colleges, and universities and an additional $7.4 billion awarded through private scholarships and fellowships.

Scholarships can be delivered in a lump-sum payment or the scholarship award can be broken up into multiple payments that are sent out each semester or school year. Depending on the scholarship, funds can either be sent directly to the student or sent to the school and the student would pay any additional money owed for tuition, fees, room, and board.

Scholarships are awarded based on a number of different criteria, including academic achievement, athletic achievement, community involvement, job experience, the field of study, financial need, and more.

Unlike student loans, scholarships don’t need to be repaid. Scholarships are generally considered gift aid.

What Is a Full-Ride Scholarship?

A full-ride scholarship is an award that covers everything — tuition, books, fees, room, board, and sometimes even living expenses. Full ride scholarships mean no other additional aid is needed to pay for school.

Full-ride scholarships are highly sought after and some may have strict guidelines and requirements.

Different Types of Scholarships for College Students

There are various forms of gift aid that students can use to pay for college. While there are differences between them, they’re similar in the fact that they do not need to be repaid. Here are different types of scholarships for college students.

Federal Grants

Federal grants are need based financial aid from the U.S. government to help students pay for college. The Department of Education offers a variety of grants to students attending four-year colleges or universities, community colleges, and career schools.

Most federal grants are awarded to students based on financial need, the cost of attendance, and enrollment status. Students can start by submitting a Free Application for Federal Student Aid (FAFSA®) form annually to determine eligibility. Once FAFSA is submitted, your school will let you know how much you may receive and when you may receive it.

Here are grant programs provided by the federal government:

•   Federal Pell Grants

•   Federal Supplemental Educational Opportunity Grants (FSEOG)

•   Iraq and Afghanistan Service Grants

•   Teacher Education Assistance for College and Higher Education (TEACH) Grants

While grants don’t typically have to be repaid, there are circumstances that may require repayment, such as:

•   You withdrew from the program early

•   Your enrollment status changed that reduced your eligibility for the grant

•   You received outside scholarships or grants that reduced the need for federal student aid

•   You received a TEACH Grant but did not meet the requirements for the TEACH Grant service obligation

Recommended: Finding Free Money for College

State Grants and Scholarships

According to the National Association of Student Financial Aid Administrators (NASFAA), almost every state education agency has at least one grant or scholarship available to residents. Eligibility may be restricted to state residents attending an in-state college, but this isn’t always the case. Check what state financial aid programs may be available to you through your state education agency.

Scholarships and Grants From Schools

Institutional aid is awarded to students by the schools they plan to attend. Scholarships and grants from schools may be offered based on need or merit. For example, a student may be awarded a scholarship or grant through the school for strong academic or athletic performance.

It’s also important to read the requirements for scholarships and grants from schools. Some awards may demand that students maintain a minimum GPA throughout the year. Others may only be available for your freshman and sophomore years.

Private Scholarships

Private scholarships are financial aid awarded to students that are funded by foundations, civic groups, companies, religious groups, professional organizations, charities, and individuals. Most private scholarships have specific criteria required to qualify, according to the Massachusetts Educational Financing Authority (MEFA) , and it may take some extra effort to research the availability of private scholarships.

Most private scholarships are only awarded for a single year. Check with the scholarship’s agency to find out if the scholarship is renewable and any criteria you may need to meet.

Main Sources of Scholarships and Grants

The main sources of scholarships and grants are from the four types of scholarships and grants listed above. Here are the major sources of scholarships and grants for college students and the percentage of total grants and/or scholarships that comes from each source:

•   Federal grants: 47%

•   State grants and scholarships: 8%

•   Scholarships and grants from schools: 35%

•   Private scholarships: 10%

Recommended: A Guide to Unclaimed Scholarships and Grants

Reasons to Be Awarded With a Scholarship

Scholarships aren’t only awarded to those with a 4.0 GPA. There are many reasons to be awarded a scholarship and students should consider their skills, areas of interest, and past achievements or awards.

Need-Based

Need-based scholarships are typically awarded to students based on their household income. The school’s financial aid office may also determine how much financial aid the student is able to receive.

Schools subtract your Expected Family Contribution (EFC) from your Cost of Attendance (COA) to determine your financial need and how much need-based aid you can receive. Your COA is the cost to attend the school and your EFC is the number that financial aid staff uses to determine how much financial aid you would receive. Information provided on your FAFSA is used to calculate your EFC.

Academic performance may also be taken into consideration when awarding need-based scholarships.

Academic Scholarships

Academic scholarships, also known as merit scholarships, are awarded to students based on their GPA and SAT/ACT admissions test scores. Award committees may also take other factors into consideration, such as extracurricular activities and leadership qualities.

Athletic Scholarships

Athletic scholarships are awarded to students who show exceptional athletic abilities while also taking academic performance into consideration. The National Collegiate Athletic Association, a nonprofit organization that regulates student-athletes, has provided more than $3.6 billion in athletics scholarships annually to more than 180,000 student-athletes. Athletic scholarships are not available at Division III colleges. Only about 1% to 2% of high school athletes are awarded athletics scholarships to compete in college.

Recommended: Balancing Being a Student Athlete & Academics in College

Community Service Scholarships

There are also scholarship opportunities for students who volunteer in their local communities. For example, the Equitable Excellence Scholarship awards students who have made a positive impact on their communities through volunteer service. The scholarship provides renewable awards of $5,000 to students for a total of $20,000 per recipient as well as one-time $2,500 scholarships.

Scholarships for Hobbies and Extracurriculars

Certain hobbies, interests, or extracurricular activities may also provide scholarships. For example, members of Starfleet, the International Star Trek Fan Association, can be awarded scholarships up to $1,000 in the categories including medicine, engineering, performing arts, international studies, business, science, education, writing, law enforcement, and general studies.

Scholarships based on Identity or Heritage

Some scholarship programs offer funds to help support traditionally underrepresented students. Outside of identity, many of these scholarships may require a minimum GPA, a need for financial assistance, leadership potential or participation in community activities.

There are also scholarships for mothers. When dealing with the costs of child care, many single mothers face unique obstacles to getting their college degrees.

Employer or Military Scholarships

Students may also be able to find opportunities through the employer of a family member. Eligibility and award amounts vary by employer. A variety of scholarships are also available to the children and spouses of active duty, reserve, National Guard, or retired members of the U.S. military.

How Can You Spend a Scholarship for Student?

How you can spend a scholarship for students depends on that specific program. Some programs may send the check directly to the college’s financial aid office to apply the funds to your tuition bill. Funds that are sent to the student may be used for education-related expenses deemed necessary by the school, like tuition, books, supplies, and housing.

Make sure to check with the scholarship program for rules regarding how you can spend your award.

How to Get a Scholarship for Student

There are several ways for students to find and apply for scholarships. Students can contact the financial aid office at the school they wish to attend or use other free resources. Some of these include:

•   Your high school counselor

•   The U.S. Department of Labor’s scholarship search tool

•   Federal agencies

•   Your state grant agency

•   Your library

•   Foundations, religious or community organizations, local businesses or civic groups

•   Organizations related to your field of interest

•   Identity-based organizations

•   Your employer or your parents’ employers

Check with each program to see how to apply and the requirements. Make sure you apply by the deadline.

Scholarship Requirements

Scholarship requirements vary by program. However, you may notice some common criteria, such as:

•   A GPA minimum

•   Age and grade requirements

•   College enrollment requirement

•   An essay requirement

•   Financial requirements

•   Location requirement

•   Test score requirements

Depending on the program, there may be some requirements related to your major, ethnicity, gender, disability or military service. In some cases, applicants may be required to complete an interview. If you’re applying for scholarships, check with each program to be sure you fully understand the application requirements and eligibility criteria.

Recommended: I Didn’t Get Enough Financial Aid: Now What?

Alternative Funding Options for College Students

Outside of scholarships and grants, there are other ways for students to pay for college.

One option is to get a part-time job and send extra income aside to put towards tuition or other school-related expenses. While this will likely not cover everything, it could make your costs more manageable. If you have a 529 college savings plan, you can tap this savings account to pay for qualified education expenses on a tax-free basis.

Students can also turn to the federal government to see if they qualify for federal work-study jobs, federal student loans, aid for military families, aid for international students or certain tax benefits. According to the Department of Education, outstanding federal student aid totals $1.61 trillion, representing 43.4 million students. These are typically awarded based on financial need and students can see what they qualify for by filling out FAFSA each year.

Another option is to use private student loans to pay for college. These are nonfederal loans made by a lender, such as a bank, credit union, state agency, university or other institution. Private student loans can be an option to consider after you’ve exhausted all other forms of aid.

Unlike most federal student loans, private loans require a credit check and the loan’s interest rate will depend on the borrower’s creditworthiness, among other factors. Private student loans are not required to offer the same borrower protections as federal student loans, things like deferment options or income-driven repayment plans.

You can even apply for scholarships and grants to pay off student loans after you’ve already graduated. You may also be able to have your student loans forgiven through state or federal programs.

The Takeaway

Before taking on student loans, scholarships and grants can be used to supplement other forms of financial aid. Before you start applying for scholarships, make sure you read the program’s requirements and turn in the application before the deadline.

If you’ve taken out federal or private student loans, there’s always the option to refinance. By refinancing your student loans, you could potentially qualify for a lower interest rate that could help you pay off the principal faster and/or decrease how much you pay each month. Note that decreasing your monthly payments is often the result of extending your loan term, which can ultimately increase the cost of borrowing over the life of the loan. Refinancing any federal loans will eliminate them from federal protections or programs such as the option to apply for Public Service Loan Forgiveness.

You can refinance the student loan with SoFi. If a competitor offers a lower rate, SoFi will match it and give you $100 after funding the loan.

Photo credit: iStock/fizkes

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

Bitcoin is one of the most secure cryptocurrencies, with a hash rate that climbed to an all-time high in January 2022. But transactions made on the Bitcoin blockchain are transparent and can be seen by anyone using widely-available blockchain explorer websites.

While future upgrades to the Bitcoin core code could make transactions more anonymous, for now any Bitcoin transaction can potentially be traced back to its source. This has led developers on a quest to create the most private cryptocurrency.

Top Privacy Coins and How They Work

There are a variety of technological methods that cryptocurrencies use to anonymize transactions. Which method works best to create the most secure cryptocurrency is a subject of heated debate within the community.

For investment purposes, it should be noted that all of these coins are highly speculative, risky, and can require opening a digital currency exchange account to trade them. As a general rule, the smaller the market capitalization and daily trading volume, the higher the risk.

Here are some of the top privacy coins available on the market today.

1. Bytecoin (BCN)

Bytecoin , which is based on the CryptoNote technology, claims to be the “first private untraceable currency.” CryptoNote was created with the goal of making transactions both a) untraceable and b) un-linkable.

Untraceable means observers cannot tell who sent a transaction to a specific recipient, while un-linkable means that observers cannot tell whether or not any two transactions were sent to the same source. The untraceable aspect is accomplished through ring signatures.

These ring signatures make its transactions opaque, meaning observers can’t see who sent the transaction, how much it was for, or who received it. Ring signatures basically string transactions together in a way that makes it difficult (but not entirely impossible) to tell them apart from each other.

To achieve un-linkable transactions, CryptoNote uses one-time keys. With ring signatures, it’s still possible to see incoming transactions to a single public key (wallet address). To fix this, CryptoNote automatically generates one-time keys whenever someone receives coins. It’s based on an encryption method known as the Diffie-Hellman Key Exchange, which allows for the sharing of secret data between two parties.

When someone sends Bytecoin to another Bytecoin address, the sender creates a unique code that gets used in the transaction. This unique code makes it look like the coins were sent to a different crypto wallet each and every time.

As of late February 2022, BCN had a market cap of $30.2 million and daily trading volume of about $30,695.

2. Monero (XMR)

Like Bytecoin, Monero is a private cryptocurrency that has privacy features built into all its transactions. XMR is actually a hard fork of BCN. That means Monero uses the same privacy tech as Bytecoin and shares most of the underlying characteristics.

When Bytecoin was created in 2012, 80% of the total supply was already in existence, as opposed to most mineable cryptocurrencies that begin with very little supply in existence.

This led seven of the developers working on Bytecoin to create a new coin by hard forking the BCN network. They called this new coin Bitmonero, which was then changed simply to Monero, which means “coin” in Esperanto.

As of late February 2022, Monero is worth over $2.7 billion with a daily trading volume of about $128 million.

3. Zcash (ZEC)

Zcash uses a technology called “zk-SNARKs,” short for zero-knowledge succinct non-interactive arguments of knowledge.

The exact details are about as complicated as the name makes it sound. What matters is that zk-SNARKs allow one party to prove to another that something is true without revealing anything specific, making this solution ideal for private crypto transactions.

However, privacy is not a default feature of Zcash, meaning that transactions are not automatically made anonymously. Zcash allows for four different types of transactions with varying levels of privacy.

The pros of Zcash is that it has some of the strongest privacy protocols on the market and the second-highest market cap of any coin on this list. The con might be the different types of transactions leading to confusion among users, some of whom might assume all Zcash transactions to be private.

As of late February 2022, Zcash is valued at $1.5 billion with a daily trading volume of about $265 million.

4. Dash (DASH)

Dash was the first private cryptocurrency created in 2014. Originally called DarkCoin, the coin eventually rebranded itself as DASH, short for “digital cash.”

As the name implies, Dash is meant to be used as a medium of exchange. Transactions can clear in a second and can cost less than a penny.

In addition to the typical crypto miners, Dash uses something called “masternodes.” These central masternodes receive 45% of all DASH mining rewards in exchange for performing essential functions on the network, including making transactions private and processing them quickly.

One of the potential cons of DASH is that these masternodes make the network more centralized than some other crypto networks.

As of late February 2022, DASH is valued at more than $968 million with $176 million in daily trading volume.

5. Verge (XVG)

Verge describes itself as a “cryptocurrency designed for people and everyday use.” Verge was created in 2014 as DogeCoinDark. Like Dash, DogeCoinDark rebranded itself shortly after its inception, changing its name to Verge.

Verge uses a technology called the Wraith Protocol to make transactions private. Wraith Protocol anonymizes transactions through the Tor Network.

By routing internet connections through multiple anonymous nodes around the world, The Tor Browser works to hide IP addresses. Wraith Protocol uses this tech for the purpose of anonymizing cryptocurrency users. This feature is optional and must be turned on.

Some benefits of Verge include fast transactions, low fees, and the potential to scale and be used by more people. The big drawback is that most of the total supply of XVG is already in circulation, so the coin will likely lose value in the long-term due to inflation, just like Bytecoin.

As of late February 2022, Verge is valued at around $155 million with a daily trading volume of around $6.4 million.

The Takeaway

Privacy coins have only existed since 2012, and didn’t really burst onto the scene in a big way until 2014. The tech is even newer than Bitcoin, and the landscape is constantly changing.

Monero is thought to be one of the most private cryptocurrencies, so much so that it has been the subject of scrutiny by regulatory agencies. But some privacy enthusiasts argue that coins like Zcash have better privacy protocols and that they might be the most secure cryptocurrencies. The subject is still up for debate.

Looking to get into cryptocurrency? With SoFi Invest® you can buy cryptocurrency from more than two dozen crypto coins including Bitcoin, Chainlink, Ethereum, Dogecoin, Solana, Litecoin, Cardano, and Enjin Coin. Investor information is kept secure and never shared with any third parties beyond what is detailed in our privacy policy.

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