Tired of the same old Bitcoin and Ethereum investments? It’s time you explored the innovative world of Stellar.
Stellar Lumens has carved out a niche, focusing on facilitating fast, inexpensive global transactions. Its partnership with IBM to develop payment solutions for banks shows the project’s impressive real-world traction. Therefore, as a top 10 market cap cryptocurrency, Stellar (XLM) provides exposure with high potential.
Thus, we will analyze if Stellar deserves a front-row seat in your portfolio in this guide. This guide will explain how to acquire XLM tokens, provide expert opinion, and technical analysis on Stellar’s investment prospects and expected price trajectory.
What are Stellar Lumens (XLM)?
Stellar Lumens is the native cryptocurrency of the Stellar network founded in 2014 by Jes McCaleb, founder of Mt. Gox and co-founder of Ripple. It uses the XLM abbreviation.
Although Stellar’s network operation closely resembles that of many decentralized payment platforms, it has a network of computers called nodes. These nodes all share a digital ledger that tracks transactions.
The Stellar network native token, XLM plays an important role in empowering Stellar’s blockchain for fast and cost-effective payments.
Therefore, it is one of the many digital currencies that offer cheap, speedy transactions. The token generally works with any type of currency.
For example, if you live in the UK and need to send money to Nigeria, you can convert Great British Pounds (GBP) to XLM through an exchange connected to the Stellar network. Once the money is reflected in the account of the recipient, he/she can then convert the received XLM to local Naira currency and withdraw via traditional banks.
What Makes Stellar Cryptocurrency Unique?
Apart from using Stellar to transfer a digital representative of traditional and digital currencies globally, the token seeks to enhance the global financial system through a single network that can integrate with banks or financial services, providing on-ramps and off-ramps for fiat currencies.
Also, Stellar grants access to the digital representation of currencies, even those not native to a user’s country. This development is helpful to people in nations where the local currency suffers from high inflation or economic instability.
For example, you can digitally hold your currency on Stellar in a more stable currency like the US dollar. This provides you, as an investor, with the option of asset preservation that may not be available through traditional financial systems.
The Unique Risks of Stellar Lumen Token
If you must know, centralization is one of the challenges with Stellar. This is because the Stellar Development Foundation holds about 60% of the total XLM supply. It now has considerable power over the digital currency and its market value.
Also, The Stellar network, for example, has a small number of validators despite using decentralized nodes. Although there are presently more than 60, this is still a small number. It makes the network more susceptible to distributed collaboration, central point failure and other types of attacks on processing capacity.
Finally, It is also important to note that Stellar hasn’t offered users many incentives to store its XLM coins outside of the 1 XLM threshold necessary to use its platform, even though this shouldn’t be a risk. There is no cryptocurrency staking available.
Also Read: Stellar Lumens: The Future of Cross-Border Payments
How to Buy Stellar Cryptocurrency Tokens (XLM)
One thing to keep in mind is that Stellar is not widely available like popular cryptocurrencies like Bitcoin, Ethereum, or other Altcoins, but is still available on many cryptocurrency exchanges such as Coinbase, Kraken, or Binance, to mention a few.
These platforms allow you to use fiat currency like USD or EUR to purchase Stellar Lumens. However, you need to have an existing account or register one.
Here are simple steps to buy Stellar cryptocurrency tokens on any cryptocurrency exchange:
1. Create an Account: The first thing to do is to register for an account on any of the exchanges where Stellar is listed.
2. Make a deposit: Once your account is verified, the next thing to do is deposit a fiat currency via the payment method available on these platforms. For example, cryptocurrency, Visacards, P2P, or bank payments.
3. Buy Stellar Token: Once that is done, you can buy Stellar by exchanging your funds for the equivalent Stellar token. This can be done by entering the desired purchase amount and pressing the buy button on exchanges. You can now withdraw your Stellar to your wallet if you’d like.
To trade cryptocurrency, you will require a secure crypto wallet. Assure that the wallet you choose should have a good reputation that will assure the safety of your funds. There are many wallets available for storing XLM. The most popular are online wallets (you can create and register a new Stellar wallet here).
Is Stellar Lumen a Good Investment?
Many consider Stellar an undervalued cryptocurrency with real potential. It has proven useful for payments and partnerships with big companies. The number of transactions on its network grew by over 375% from 2020 to 2021, showing strong adoption.
But like all cryptocurrencies, investing in Stellar still carries risk. There are no guarantees it will succeed in the long term. One possible concern is that Stellar competes with Ripple’s XRP token for payment transactions. But XRP has a much larger market cap currently compared to Stellar.
In the end, deciding to invest in Stellar comes down to believing in its future as a global payments network and its development team. If you think blockchain will transform how money is sent around the world, Stellar could be a promising bet. But you have to be comfortable with the volatility and competitive risks of other cryptos in the payments space, like XRP.
As always, only invest what you can afford to lose. Stellar has potential, but it also faces challenges in becoming a top global payment protocol.
Stellar Lumens Price Prediction for 2024
In early 2023, Stellar’s XLM token was trading around $0.07, significantly down from its all-time high of $0.87 reached in the volatile crypto boom of 2018. XLM had also fallen substantially from its 2021 peak of $0.66, which it struggled to retest during subsequent rallies.
XLM followed the broader cryptocurrency market’s decline after hitting $0.25 in March 2022. By May of that year, amidst a crash impacting major coins like TerraUSD, XLM had plunged to $0.105.
However, Stellar showed strong momentum to begin 2023, surging over 180% within months back to the $0.197 level attained in April 2022. By mid-July 2023, XLM managed to revisit key resistance levels not seen in over a year, showcasing a robust recovery from 2022 lows.
With crypto markets highly unpredictable, it remains to be seen if Stellar can maintain upward momentum and return to its all-time high. However, its recent resurgence highlights Stellar’s enduring presence among the top tier of cryptocurrency projects by market capitalization.
So, making predictions for where Stellar’s price could go in 2024 depends on many different factors in the crypto world. If positive momentum continues, Stellar could break past resistance around $0.24 and reach over $0.30 at its peak next year. However, the low end may be around $0.25 based on market conditions.
In the past, legal actions from the Securities Exchange Commission against major exchanges like Coinbase and Binance caused major crypto price swings. This could happen again. However, a recent court ruling found that XRP did not violate securities laws.
Also Read: SEC vs Ripple Lawsuit: Ripple Marks Significant Win
This was good news for Stellar too, since it faces similar questions over whether it is a security.
Overall, a lot can change, which makes 2024’s Stellar prices hard to predict accurately. But if the crypto market sentiment stays upbeat, Stellar looks positioned to grow next year. However, users should expect ongoing volatility as regulatory news unfolds.
Conclusion:
With its cutting-edge approach to global trade, dedication to financial equality, and proven performance, Stellar is a noteworthy option for novice and experienced investors. Therefore, putting money into Stellar (XLM) offers an exciting journey into the international arena of blockchain-based currencies and technology.
To successfully control risk with a financial asset, it is critical to do extensive research, monitor market movements, and diversify your holdings. Even though Stellar has demonstrated its promise, keep in mind that the market for digital currencies can be unstable and that prices can change considerably. As a result, it’s imperative to tackle Stellar investment with patience, a defined plan of action, and an outlook for the future.