Stellar (XLM) Review: The Crypto You Know Less About
Although Stellar doesn’t make headlines so often as Bitcoin or Ethereum, this crypto is one you should start paying more attention to. Stellar (XLM) is a cryptocurrency that relies on well-known blockchain technology, however, Stellar uses it in a very different way from many competitors. What is special about Stellar Lumens? Firstly, the Stellar project is not only about the particular cryptocurrency, it is a huge network that opens the door to many fantastic opportunities. Secondly, XLM has a unique position on the crypto market, as it has changed the way how transnational transactions work. Thirdly, Stellar Lumens can be a super exciting investment option for new crypto users.
In our Stellar review, you will find everything you need to know about the platform and cryptocurrency.
What is Stellar?
Let’s start from the very beginning and explain what Stellar is and how it works. The first thing you should know about Stellar is that it is a payment system.
Stellar works as a decentralized network that is designed to offer a fast, safe, and low-cost international payment solution. The platform can also be used to release other tokens, and this makes Stellar so special. However, that’s not all.
Stellar and its foundation were both created in 2014, and the platform also relies on the native cryptocurrency, called Stellar Lumens or XLM. The unique crypto solution allows users to make almost instant transactions between various currencies and make payments throughout the world. No matter where you are, you can use Stellar to solve your financial problems. Generally speaking, the Stellar platform was launched as a decentralized ecosystem to provide people from all over the globe with fast and cheap asset transfers to anyone in the world.
Although we have numerous financial institutions, the Stellar project is something different. It focuses not on businesses, but primarily on people. The network connects banks, individuals, and payment systems to transfer assets reliably and safely. Moreover, the transactions are much more inexpensive if we compare the cost to traditional payment approaches.
Stellar is aimed to transform international payments significantly, making them simple, quick, and low-cost for all users. Sounds fantastic, doesn’t it?
Furthermore, Stellar can work as a launchpad for ICOs, and it is much simpler to release tokens using the Stellar blockchain technology than other networks. For example, the Mobius Network and Smartlands are among the projects that have been based on Stellar blockchain.
What makes Stellar good?
At first glance, Stellar seems to be similar to traditional financial institutions. Yes, it is partially true as Stellar offers many of the same financial services you can get from your favorite bank. However, there are some key differences you should bear in mind.
First of all, the operations on Stellar are based on decentralized blockchain technology and network. Why is it good? It makes all processes much faster. Plus, it allows the platform to significantly reduce fees when compared with common ways to transfer money.
When it comes to other cryptocurrency projects, Stellar also has unique features. While most of these famous crypto ventures are concentrated on providing benefits to businesses, Stellar was launched with a wonderful altruistic goal. They wanted and still want to create an inclusive digital environment open to everyone.
What are Stellar Lumens?
Stellar Lumens, which are traded as XLM, are the native cryptocurrency operated on the Stellar platform. How many Lumens do we have nowadays? Stellar was created with 100 billion Lumens, but the annual inflation rate is about 1%. At the end of 2019, Stellar released more than 105,323,320,393 XLM.
How do Lumens work in the digital world? XLM has two purposes on the Stellar platform:
- It bans network spamming by covering the cost of transactions. At the same time, it guarantees that the customers are real and maintain a minimum balance. Stellar has the minimum balance requirement to save the network from fake transactions. And once again, we want to mention that the cost of the transaction is super low. Each transfer on the Stellar platform has a fee of just 0.00001 XLM.
- It also helps to make multi-currency transactions much easier. XLM acts as a bridge between different currencies. In other words, it allows operations to happen even when the direct market doesn’t support direct transfers.
Is XLM a good way to invest?
Similar to other cryptocurrencies, Stellar Lumens can be used for investment.
Although Lumens were started to trade six years ago, it remained pretty unprofitable for three years after the release. Lumens traded between $0.001 and $0.006. However, the situation changed in 2017 when XLM picked up steam. Nowadays, it is a quite good option to invest in.
How to trade and store XLM
If you want to buy XLM, you need to know how to trade and store them in the most effective way. Stellar Lumens are traded on dozens of various exchanges. The list includes not only well-known exchange projects but also new crypto startups on the market. There is also a bunch of local fiat exchanges that can be used in particular areas.
When we are talking about trading volume, more than 50% of it seems to be accumulated in three exchanges, such as BCEX, LAToken and BitForex. This means that XML appears to be strong liquidity. In addition to this, Stellar Lumens are safe and reliable.
Once you collect some Lumens, you need to store them. But how to do this properly? You will need a trustworthy digital wallet. You definitely must to have it as leaving your crypto on an exchange platform can be very risky. Choosing a digital wallet won’t be a problem when it comes to Lumens. There are plenty of wallets that support XLM.
What are Stellar’s plans for Lumens?
Stellar is also unique when it comes to distributing digital coins. The mission of the Stellar Development Foundation is to promote transparent transactions, financial literacy, and inclusion. That’s why Stellar has an ambitious plan to give away around 95% of all Stellar Tokens to people.
Stellar Foundation has kept 5% of the 100 billion XLM on its own accounts to finance its operations and sell them off in small portions to different exchanges. The rest is meant to be distributed in several ways:
- 50% will be distributed to people. At first, this process was held via a unique link, but then Stellar has put this initiative on hold. The Foundation announced an airdrop program. The most recent was planned for September 2019. They were going to give away 2 billion XLM to users of Keybase. Unfortunately, this airdrop was canceled.
- 25% have been meant for partners who help the Stellar network develop and grow. This category includes companies, non-profit organizations, and even government institutions.
- 20% were granted to BTC and XRP users in October 2016 and August 2017. 19% were going to BTC holders and 1% to Ripple holders.
Stellar definitely has myriads of opportunities coming in the weeks, months, and years ahead. Therefore, it is a great idea to look at it closer. If you are going to make XLM purchases, take your time to do your research.
However, it is quite clear the crypto market likes this project, and it has a bright future.