Should I invest in Stellar cryptocurrency?

Hodl Stellar

Stellar (XLM) quickly gained popularity among investors and competed with the leaders of the digital market. To date, this coin attracts the attention of many speculators, so the reader should become more familiar with its features. In this article, we will talk about what features Stellar has and how it can be useful to a speculator.

What are the differences between Stellar and other cryptocurrencies?

Some experts claim that Stellar is an improved and more perfect version of Ripple. To some extent, this statement is indeed true, because the main functions and tasks of these systems are the same. But Stellar 2018 solved many of Ripple’s problems and surpassed it in many ways.

First of all, the development is a fully decentralized system. Its creators took into account the mistakes of their predecessors and organized the correct distribution of coins. While the developers of Ripple appropriated over 60% of all cryptocurrencies, the founders of Stellar fairly distributed funds among the participants. Thus, Stellar’s rate does not lend itself to manipulation by the developers and is considered more transparent. The formation of the value of coins depends solely on supply and demand on the trading floor.

Among other things, Stellar platform is considered the fastest exchanger, working without third-party resources. In addition to its basic functions, this system will be able to become a new leader among decentralized exchanges. Due to the lack of such organizations, the company will be able to gain wide popularity among cryptocurrency traders.

Last year, the developers of the platform presented their own concept of a network ATM. This innovation will attract to the crypto-industry those who are not too versed in the specifics of electronic money, but want to make good money from it. Acquisition of digital currency has become easier and more accessible. Now every user with basic knowledge of PC can make an exchange.

One of the founders of Stellar announced an agreement with major banking institutions. According to him, 30 financial and credit institutions agreed to fruitful cooperation with the blockchain project. The crypto coin has been officially listed as supported by the popular cryptocurrency wallet Nano Ledger S.

An important feature of Stellar cryptocurrency is the ability to create tokens. Thus, new ICOs are being developed and launched based on the decentralized platform. The developers plan to poach some of the users of Ether through a simpler programming language. The drawback of Ether is the difficulty in writing smart contracts. The program involves the use of a rare programming language, so the team has to find a specialist and pay for his labor. The Stellar network has eliminated this problem by switching to a more familiar programming code.

The Stellar system has several other important features:

  • The development of the project is the responsibility of a non-profit foundation, which is not controlled by the developers and acts independently.
  • The platform initially uses its own open protocol. Its work becomes transparent for each user.
  • Transactions are confirmed in just 5 seconds.
  • Security is ensured thanks to cryptographic encryption and autonomous nodes.
  • Each participant has free access to information about the activities of the governing fund. Investments, acquisitions and employee salaries are located on a public server.
  • A quarter of the cryptocurrencies created were immediately transferred to nonprofit organizations. In addition, 5 percent of the total was frozen within the system. These funds will go to pay for operating expenses and reduce user fees.
  • Every participant has equal rights and opportunities, regardless of their capital or transaction size.
  • A special agreement was created in the fund to prevent market-making manipulation. According to this document, holders of large capital can not sell it during the first 5 years. Now the rate of cryptocurrencies will not depend on the “sharks” of the market.

Thanks to the innovations described above, the creators of the digital system have reduced the gambling component as much as possible and made their project open to any user.

Despite the abundance of advantages, there are flaws in the development. The high entry threshold and the impossibility of mining somewhat limit the user. The introduction of a minimum volume of transactions is explained by the protection against spam attacks. It is known that the activity of the exchanger can slow down due to the appearance of “fake” users, so the developers have taken appropriate security measures.

How does the system work?

Stellar is a decentralized consensus platform, which performs fast and high-quality exchange of any financial assets. Cryptocurrency in this case acts only as a unit of exchange. Thus, the token represents a “bridge” for barter.

Initially, the crypto structure used the coin of the same name, but during the update the currency was renamed to Lumen (XLM). To make an exchange transaction through this service, you need to register, choose one of the proposed options and put your assets into your account. The system will make the exchange and withdraw funds in the desired currency to the specified address.

Such a convenient and fast scheme operates due to the internal decentralized exchange. The built-in SCP algorithm, which is also a consensus protocol, has at its core a distributed data registry. This registry contains all information about the transactions that have taken place.

The operation of the registry is provided by multiple peer-to-peer nodes. Even in the event that one component fails, the remaining parts will maintain uninterrupted operation. Thanks to the clever system, the collapse of this system is virtually impossible.

Where to buy Stellar and how to store the funds?

Since coins cannot be mined, people have only to buy them. It is possible to get cryptocurrencies on special exchanges:

  1. Bittrex offers a BTC or ETH transaction.
  2. Binance offers the ability to exchange using Bitcoin, Ether or internal exchange currency.
  3. Poloniex only works with BTC.
  4. Kraken gives the opportunity to get coins for Bitcoins or Etheriums.

Is it worth investing in Stellar? Forecast by leading analysts

Most experts agree that the market value of this currency will rise regularly. This trend is directly related to the growing popularity of cryptocurrencies.

Investing in Stellar

At the moment, users have already appreciated the benefits of XLM, and consider it one of the most comfortable systems of the current century. The coin occupies the 6th place in the ranking, and its capitalization is growing at an amazing rate.

In favor of the rapid growth of capitalization are some significant factors:

  • Influential corporations are already starting to use the cryptosystem. They are actively investing in the development of the project and hope to use the tokens for their own purposes.
  • The functionality of this cryptocurrency is constantly increasing. Experts assure that soon XLM will be used to launch an African messenger and make electronic payments in several developed states of the black continent.
  • The development is based on a unique technology that allows the fastest possible currency exchange. At the same time, the participant does not lose money on commission costs and pays only a small fee for the use of the service.

Due to these facts, the popularity of cryptocurrencies will increase. Due to the active growth of demand with limited supply, the value of the digital currency will begin to grow uncontrollably.

About Jamie Martinez 16 Articles
Jamie is a graduate MBA from the UCLA Anderson School of Management and now is engaged in cryptocurrency analytics and forecasts. She also writes extensively on blockchain, cryptocurrency, and the modern digital technologies for business.