What is Stellar (XLM)?

What is Stellar (XLM)?

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Money may be transported and kept on Stellar, which is an open network that allows for this to happen. Initially, one of its objectives was to increase financial inclusion by addressing the world's unbanked; however, this goal was quickly replaced to assist financial institutions in connecting using blockchain technology.

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Lumens, the network's native token, serves as a bridge, which makes it significantly cheaper to exchange assets across international boundaries than it would otherwise be.

All of this is intended to put pressure on conventional payment providers, who frequently demand exorbitant costs for a comparable service.

The Ripple Labs protocol was the inspiration for the development of Stellar. In the aftermath of a hard fork, the blockchain and its code were formed, and the code was then adapted.

 

Component Stellar (XLM)
Technologies Stellar Consensus Protocol, Stellar Anchors
Market Capitalization $6.54 Billion+
Open-Source Yes
Consensus Mechanism Stellar Consensus Protocol
Smart Contracts In progress
Founders/Authors Jed McCaleb
Launch Date 2014
Circulating Supply of Coins 24,652,747,394 XLM
Maximum Coin Supply 50,001,806,812 XLM
Mining-based Coin? No, XLM is released into circulation yearly
Is Stellar a Stablecoin? No
Does Stellar have a burn rate? Yes
Does Stellar have a Whitepaper? Yes, the white paper can be viewed here

 

Evolution and Development of Stellar

The Stellar Development Foundation, formed by Jed McCaleb, oversees running Stellar. In July of that year, the charity Stellar Development Foundation was founded with Stripe CEO Patrick Collison. Stripe invested $3 million in Stellar.

Stellar was launched as a decentralized payments system and protocol with its own native currency. The network began with 100 billion Stellars. 25% of the funds would be distributed to other non-profit organizations dedicated to financial inclusion. 

Stripe acquired 2% of the first Stellars (Equal to 2 billion in the native token of Stellar) in exchange for its startup investment. Mercado Bitcoin, Brazil's first bitcoin exchange, stated in August 2014 that it would be utilizing the Stellar network.

Lightyear.io, which is a for-profit subsidiary of Stellar, was formed in May 2017 as the company's commercial arm. In 2017, the Stellar Partnership Grant Program integrated a benefits program to expand the services offered.

It would give partners up to $2 million worth of Lumens to use to help them with their projects. In September 2018, Lightyear Corporation bought Chain, Inc., and the new company was called Interstellar, or Interstellar.

The non-profit accepts tax-deductible donations from the public to pay its operational expenditures. Cross-border transactions to more than 70 countries were made possible through a partnership between Stellar and TransferTo in 2018.

A Shariah-compliance credential for payments and asset tokenization, as well as a partnership with IBM on a double-pegged stablecoin project, made it the first distributed technology ledger to be certified for Shariah compliance.

What makes Stellar unique?

Every transaction on Stellar costs just 0.00001 XLM, making it one of the most cost-effective cryptocurrencies on the market. A few pennies for a unit of this currency at the time of this writing makes it easier for consumers to keep even more their funds.

Few blockchain initiatives have been able to gain collaborations with big-name technology corporations and financial services businesses. ‘ As part of a partnership with IBM a few years back, Stellar and IBM launched World Wire, a project that allowed major financial institutions to transmit transactions to the Stellar blockchain and trade using bridge assets like stablecoins.

In contrast to other blockchains, Stellar allows users to participate in governance on which projects should get financial support from its community funds. Stellar Anchors are another important component in the Stellar network (originally called Gateways).

Deposits of currencies and valuables are accepted by these entities, who then create Stellar-based representations of such assets. As a result, anchors specify the conditions under which Stellar users are permitted to store assets. Users' access to assets can be revoked at any time.

 

What are the main uses for Stellar?

By connecting ordinary banks to a payment service, anybody may send money across borders swiftly and cheaply. No need to worry about completing the conversion yourself or hiring a second party to do it for you.

Companies may also build their own coins on top of Lumens to take full advantage of the network's low costs and fast transaction speeds.

 

What is the future potential for Stellar?

Stellar's core focus is on emerging nations, specifically remittances and non-bank lending. Stellar envisions a world where anybody may transmit money to anyone fast and easily. The network is free to use for people and institutions.

The robust and innovative distributed exchange mechanism in Stellar allows users to carry out transactions in one currency while holding credit in another. This then allows the recipient to withdraw money from a partner institution or a partner/affiliate.

 

Price analysis on Stellar

Stellar was initially launched in 2014, and its price analysis over the past five years are indicated as follows:

 

  2017 2018 2019 2020 2021 to date
XLM Price High 0.3608 $0.8962 $0.1415 $0.2064 $0.73
XLM Price Low $0.0017 $0.09544 $0.04344 $0.03344 $0.1278
Market Cap $6.44B $16.02B $2.72B $4.47B $16.85B

 

Price prediction on Stellar

According to industry professionals and researchers in the cryptocurrency and financial ecosystem, Stellar Lumens price forecast 2022, investors might see XLM to USD as an alternative coin that can deliver generous passive investment returns.

Based on the price trend and Stellar lumens price estimate, the XLM price may emerge as a serious contender in the race. There is also conjecture and future Stellar Lumens price projection that its significant gain over the last year suggests that Stellar Lumens price may be expected to be in the range of $0.65 – $0.75 in 2022.

Thus, by the time that 2025 arrives, the price can move up in the range of $1.50 – $2.00, which could mean a lucrative return on investment.

 

Which wallets are the best option for storing Stellar?

A Stellar wallet is a software extension or application that allows users to save the information they need to access their Stellar (XLM) monies to spend them.

This information includes a private key, which functions similarly to a password, and a wallet address, also known as a public key, which functions similarly to an account number.

Some of the best wallet options in the cryptocurrency space for XLM include the following wallets.

  1. Stellar Desktop Client
  2. Stronghold Wallet
  3. StellarTerm
  4. Lobster
  5. Atomic Wallet

 

1. Stellar Desktop Client: This wallet is only available for desktop users. Once setup is finished, users will notice that the interface is well-structured, straightforward, and simple to use, which is an excellent feature for first-timers.

There are two options: make a new wallet or recover an existing one. A password-protected text file is produced and saved on the user's computer when you create a new wallet.

The file must be enabled each time the user wants to access their wallet. In effect, the file serves as their private keys, granting them access to the Stellar blockchain, which means that private keys must be safeguarded.

 

2. Stronghold Wallet: Stronghold is a wallet for exchanges, and what makes it unique is that the cryptocurrency exchange —Stronghold– is built on the Stellar blockchain. It touts itself as the Stellar network's on-ramp and off-ramp for Lumens (XLM) from the Stellar decentralized exchange, also known as the DEX.

 

3. StellarTerm: This is a well-known and well-respected web-based wallet with a solid security record and a decentralized cryptocurrency exchange that includes a trading client for traders and investors.

Because the wallet works on the Stellar network, which hosts this wallet, the safety of the user's XLM tokens is guaranteed. Users can produce public and private keys straight through the wallet's user interface, which is simple to use and appealing.

 

4. Lobster: Lobster is a free service that requires users to register using their email account to begin using it. The user's Lobster web client login information will be emailed to them, and they should then log in and establish a Stellar Account.

After that, the account recovery seed phrase, as well as the public and private keys, may be readily generated.

 

5. Atomic Wallet: Atomic is a multi-currency Stellar XLM wallet that supports over 300 additional currencies and tokens and is free of custody. In a user-friendly interface protected by a mnemonic seed, users can secure, manage, exchange, and acquire XLM.

With the reputable and widely-used Atomic Wallet, users have complete control over their finances.

 

Where can you buy Stellar?

Stellar can be bought from the following popular crypto exchanges.

  1. Kraken
  2. Bitfinex
  3. Upbit
  4. Coincheck
  5. Bittrex

 

1. Kraken: Kraken is among the oldest Cryptocurrency exchanges and offers reasonable exchange fees for over 50 different currencies. It supports both spot trading and bitcoin futures.

Users can purchase assets like Bitcoin and Ethereum on Kraken. Cryptocurrency investors and traders searching for minimal trading costs and a large coin selection might choose Kraken.

 

PROS CONS
Offers more than 50 alternative coins that can be traded Higher fees when not using Kraken Pro
Offers a simple and straightforward user interface Competitors offer a larger array of altcoins
Kraken is an exchange with high liquidity  
High trust score from investors and traders  
Offers futures and spot trading  
Low transaction costs  

 

2. Bitfinex: Bitfinex is a cryptocurrency exchange that is based in Hong Kong and has been in business since late 2012. Bitfinex is well-known for providing the most liquid order book globally, attracting active traders and high-volume traders alike.

Bitfinex offers over 50 trading pairs, a wide range of order types, and a customizable interface.

 

PROS CONS
Suitable platform for experienced traders History of hacks
Offers more than 100 different crypto coins and 50 pairings that can be traded Does not allow debit or credit card deposits/withdrawals
Offers high liquidity because of large trading volumes Unregulated
Allows traders to deposit funds using bank wire The platform does not offer its services to United States clients
Offers a range of order types that can be used   

 

3. Upbit: Upbit is a South Korean-based cryptocurrency exchange that has expanded to other Asian countries. Upbit is the best cryptocurrency exchange by volume in South Asia. For those outsides of South Korea, a translated worldwide edition of the website is accessible.

 

PROS CONS
Offers more than 100 crypto coins The website is currently in Korean
Backed by one of the largest technology companies in Korea The only fiat currency supported is the South Korean Won
Only the best technology is incorporated in its trading platform Margin trading is not provided
There is extremely robust cybersecurity  
High trust score from investors and traders  
Dedicated customer support offered  

 

4. Coincheck: Coincheck is a cryptocurrency exchange and trading platform that allows project partners to earn passive revenue. Coincheck trades Bitcoin, Litecoin, Ethereum, BitcoinCash, and a wide range of other crypto coins.

The Japanese yen is shown as the only accepted fiat currency on the platform thus far. The company's own trading terminal, Coincheck Trade View, features an online and mobile version which ensures that traders' accounts can be integrated across devices.

 

PROS CONS
Offers a convenient trading terminal Only supports the Japanese yen right now
Offers a wide range of tradable crypto tokens Communication with customer support can be tedious because of the ticket system
Offers a profitable crypto lending program  
Known for its high level of security across the platform  
There is no trading commission charged  
Novice traders can choose from a wide range of educational materials  

 

5. Bittrex: Bittrex is a desktop and mobile cryptocurrency exchange. Users can access their personal dashboard, deposit funds, and trade using an innovative desktop or mobile application.

To access your account on the go, Bittrex has a mobile app. The software allows users to buy, sell, and withdraw money. Advanced crypto traders might benefit from advanced charting and orders.

 

PROS CONS
Known for its ultra-low fees charged Not available to all states in the United States
The platform is available to users in all countries around the world The trading interface may be tricky to navigate for complete beginners
Offers strong security features on the platform There are only 57 cryptos for instant purchase using USD
Provides access to more than 200 digital assets that can be traded  
Boasts with a high level of trustworthiness  
Caters for beginners and experienced traders  

You can buy Stellar safely from these cryptocurrency platforms.

Does Stellar use coin burns?

Stellar does not actively burn coins, but in November 2019, the Stellar Development Foundation burned 55 billion XLM tokens, which is more than half of the total supply of XLM.

 

What is Stellar’s largest Competitor?

The largest competitor of Stellar is Ripple (XRP).

Stellar's cryptocurrency is more user-friendly, and this characteristic makes it extremely unique. Unlike Ripple, which is aimed at banks, Stellar is aimed towards individuals, particularly those in underdeveloped countries.

Banks form part of a massive market that generates a great deal of money. Meanwhile, Stellar focuses on individuals, particularly those from developing nations, allowing unbanked people to connect with the global economy.

The global economy will therefore be accessible to those living in remote corners of the earth. In addition to this, the prices are extremely low, making transactions easy.

The Stellar protocol allows for direct fiat money exchange. Usually, the sender's money is turned into Lumens and the receiver's money into Lumens.

Their algorithms are one of the most noticeable discrepancies. In addition to this, XRP coins are deflationary, whereas Lumen coins are inflationary.

Stellar has a smaller staff count than Ripple, and Stellar does not market as often as its competitors. Ripple is a massive corporation with a lot more funding, and their intended audience is distinct, generating more cash.

 

What can Stellar smart contracts do?

A smart contract is a piece of software that runs on a blockchain network. Smart contracts are made up of code (functions) and data (state) stored at a specified address on the blockchain.

Stellar (XLM) developers presented a new way to execute smart contracts. It uses Turing Signing Servers (TSS) to support decentralized banking on Stellar.

Stellar Network (XLM) will fully onboard a new smart contract, according to Script3 developers. Developers could submit smart contracts to a turret, which can then generate a keypair for signing transactions.

The transaction is then validated by other turrets on the blockchain. To finish the transaction, allowing different users to run smart contracts across all turrets.

Project Venus aims to develop a safe and stable server network and provide short-term forward contracting to Stellar Network (XLM).

 

Is Stellar a Good Investment?

Stellar is a good investment according to the following factors:

  • Price-performance and historical data – To date, XLM has demonstrated potential. The asset's value has increased to $0.2643 as of December 21, albeit not without some volatility. Due to this general increase, XLM is a sound long-term investment.
  • Potential value – No further Lumens will be created by Stellar at this time. Despite this, it is crucial to know that the currency will become rare in the future. Rarity adds value to any item, as should be the situation with the remaining Lumens. The potential growth in value may make XLM a good purchase and hold.

 

What is the supply and distribution of Stellar?

Stellar has a circulating supply of 24,652,747,394 XLM and a finite supply of 50,001,806, 812 XLM

  • Fixed or maximum supply can be defined as the total number of coins that can ever be in circulation.
  • Total Supply refers to the number of coins that have been mined, including the missing coins that are no longer in circulation or that have been lost.
  • Circulating supply refers to the total number of coins that are in circulation.

 

Is Stellar a viable Alternative Coin?

Yes, Stellar is a good alternative coin in terms of:

  • Hacking – The Stellar blockchain has not experienced any successful hacking attempts.
  • Security – Stellar is a robust and secure blockchain that uses some of the best, most innovative technology.
  • Transaction speed – Stellar has a fast transaction speed between 3 to 5 seconds.
  • Technology – Stellar uses innovative technology, including Stellar Consensus Protocol, Stellar Anchors, and more.
  • Potential Investment – Stellar has a lot of potentials to become a viable investment, ensuring that it has a significant amount of future uses, especially for unbanked nations in the world.
  • Popularity – Stellar is popular, but it still lags behind its competitor, Ripple.

Any cryptocurrency that isn't Bitcoin is referred to as an altcoin.

What are the differences between Stellar And Bitcoin?

Bitcoin is considered the future of international electronic cash, while Stellar is a fast, cheap, and one of the safest transaction platforms in the industry.

While Bitcoin and Stellar both aim towards being fast, efficient payment methods that are an alternative to conventional cash, both have different target markets.

Bitcoin is still the king of cryptocurrencies and has become a store of value and efficient medium of exchange. Stellar has its sights on those who do not have access to traditional banking services.

Stellar is much cheaper than Bitcoin in addition to being faster, but it has not gained the same level of popularity that Bitcoin still boasts with.

 

  Bitcoin Stellar
Price change 20/21 +400% 100%
Market Cap $800 Billion+ $6.54 Billion+
Past Hacks None None
Popularity Very High High
Altcoin Rank #1 – Original Crypto #26

 

What are the differences between Stellar and Ethereum?

The value propositions and designs of Ethereum and Stellar are vastly different. Although Ethereum is a decentralized network that can be used for payments, its function is broader than that of Stellar. Ethereum's network is also extremely popular in decentralized financial and non-fungible token marketplaces.

Beyond the financial industry, Ethereum wants to decentralize products and services. One thing that these two vastly different digital currency platforms have in common is that Stellar and Ethereum both can help the unbanked.

The Stellar Development Foundation and the Ethereum Foundation are both non-profit organizations. Ethereum sold 72 million ETH to raise $18 million.

Although Ethereum is going toward proof-of-stake consensus, the network is still utilizing proof-of-work, like Bitcoin. The Stellar Consensus Protocol is responsible for validating network updates and transactions.

 

  Ethereum Stellar
Price change 20/21 +880% 100%
Market Cap $460 Billion+ $6.54 Billion+
Past Hacks None None
Popularity Very High High
Altcoin Rank #2 #26

 

What are the differences between Stellar and Dogecoin?

Dogecoin is a more unconventional medium of exchange because it is commonly used to tip content creators on platforms such as Reddit and Twitch. 

However, even though it is the most popular meme coin on the market, it is worthy to note that as opposed to Stellar, Dogecoin charges a much higher transaction fee than many other cryptocurrencies and crypto payment platforms.

In addition, Dogecoin's validation time and transaction speed are much slower, and Dogecoin's daily transaction volume has declined significantly over the past few years.

Paying across borders take extremely long to process, even up to a week, with the current financial infrastructure. On Stellar's blockchain, over 180 different fiat currencies may be converted to Lumens, transported across seas, and settled in seconds.

 

  Dogecoin Stellar
Price change 20/21 +7,300% 100%
Market Cap $22 Billion+ $6.54 Billion+
Past Hacks None None
Popularity High High
Altcoin Rank #12 #26

 

What are the differences between Stellar and Neo?

Using Neo dev tools, developers can simply build decentralized applications and deploy them with smart contracts, all while verifying up to 10,000 transactions per second.

Neo is one of the main DApp networks, allowing developers and users to construct digital identities through tokenization for AML and KYC compliance.

Neo has different technology and a completely different audience than Stellar, which aims to achieve cross-border payments at low rates and fast speeds.

 

  NEO Stellar
Price change 20/21 +160% 100%
Market Cap $1.70 Billion+ $6.54 Billion+
Past Hacks None None
Popularity Medium High
Altcoin Rank #69 #26

 

What are the differences between Stellar and NFTs?

Nonfungible tokens (NFTs) are digital assets that each have a unique value, with no two NFTs holding the same characteristics or value as another. Stellar, on the other hand, is fungible, which means that one XLM has the same value and characteristics as another XLM.

 

What are the differences between Stellar and Solana?

Solana is a blockchain network that allows developers to create smart contracts and a wide range of DApps. Solana is not a payment platform like Stellar, but its 50,000 transactions per second are what distinguishes this new blockchain network.

 

  Solana Stellar
Price change 20/21 +9,300% 100%
Market Cap $54 Billion+ $6.54 Billion+
Past Hacks None None
Popularity Very High High
Altcoin Rank #5 #26

 

What are the differences between Stellar and Cardano?

Cardano lets users conduct transactions solely using native coin ADA and construct safe, decentralized apps, whereas Stellar allows users to make global transactions in any form. Cardano employs Proof-of-stake consensus, whereas Stellar uses its own Stellar Consensus process.

Cardano aims to increase financial system scale, interoperability, security, and governance. The Cardano project is supported by the Cardano Foundation, IOHK, a blockchain engineering business, and Emurg, an organization that encourages developers to build apps in the Cardano ecosystem.

Stellar's major goal is to link underprivileged individuals to low-cost financial services. The transactions made with XLM are recorded on the public ledger, but the identity of users is not known.

 

  Cardano Stellar
Price change 20/21 +2,100% 100%
Market Cap $42 Billion+ $6.54 Billion+
Past Hacks None None
Popularity Very High High
Altcoin Rank #7 #26

 

What are the differences between Stellar and XRP?

Individuals who have used both Stellar and Ripple have recognized the systems' commonalities. They both employ almost similar blockchain code, neither enables mining, both rely on a distributed ledger, and both offer free and quick transactions.

These parallels are large because McCaleb, one of the platforms' creators, saw what worked effectively with Ripple and took that vision and experience to Stellar.

The platforms' objectives are distinct. Ripple was established to enable banks to send money anywhere in the globe in a matter of seconds for a very low fee. It boosted banks' and financial systems' efficiency.

On the other hand, Stellar was designed with the typical user in mind, as well as those in poor nations. Through easy, rapid, and low-cost transactions, the platform connects users to the global economy.

While both Ripple and Stellar are available to the overall public, they were built for certain users to deliver a more efficient experience to their core markets.

 

  XRP Stellar
Price change 20/21 +840% 100%
Market Cap $50 billion+ $6.54 Billion+
Past Hacks None None
Popularity Very High High
Altcoin Rank #8 #26

 

What is a stablecoin?

Stablecoins are digital currencies that are linked to a “stable” reserve asset, such as the US dollar or gold. When compared to unpegged cryptocurrencies like Bitcoin, stablecoins are meant to minimize volatility.

 

Is Stellar a stablecoin?

No, Stellar is not a stablecoin. However, stablecoins can be created on Stellar's blockchain. In September, the first stablecoin that is pegged to the national currency of Peru, the SOL, was launched on Stellar's blockchain.

 

Is being open-source an advantage over being closed-source?

Both Open-source and closed-source have their unique advantages and disadvantages.

Because open-source software is frequently free, it is the greatest option for individual users. A closed source can be more expensive since it must be tailored to the demands of the user. – Closed source. However, software wins in the service category because dedicated support teams are available to assist users when they need assistance.