Stellar Lumens, also known as XLM, is a digital token native to the Stellar network. Stellar, created by Ripple co-founder Jed McCaleb in 2014, is a platform designed to facilitate the transfer of digital assets across borders quickly and efficiently. Charting Stellar’s performance and its impact on the crypto sphere provides invaluable insights into its potential and persistence in the competitive industry.
Performance Of Stellar Lumens:
Lumens (XLM), the cryptocurrency used on the Stellar network, has seen significant volatility since its inception. Its price has fluctuated greatly over the years, reaching an all-time high of around $0.93 in January 2018 during the crypto boom, then plummeting and hovering around $0.07 to $0.13 during the subsequent years.
However, XLM has made notable strides in 2020 and 2021. For instance, in November 2020, XLM’s value surged by over 100% within a week, driven by a major update to the Stellar network protocol and Bitcoin’s price rally.
Future potential:
Stellar’s value not only depends on market trends but also on its adoption and partnership news. Stellar has forged some important partnerships over the years, including IBM, which uses Stellar for its cross-border payment system, IBM Blockchain World Wire. Stellar’s partnerships and its potential for enabling quick, low-cost international transactions, make it a strong contender for widespread adoption, and therefore a promising investment.
Implications for the Crypto Industry:
The significance of Stellar in the broader crypto industry primarily lies in its purpose: facilitating low-cost, efficient cross-border transactions. Stellar’s blockchain can handle exchanges between fiat-based currencies, as well as tokens backed by certain commodities, thereby streamlining international money transfers and remittances considerably.
As more entities, including banks and fintech companies, continue to adopt blockchain technology for cross-border transactions, Stellar could play an increasingly important role within the crypto sphere. Notably, its partnership with IBM could lead to significant global enterprise adoption.
Furthermore, Stellar’s focus on compliance with regulatory institutions and their effort to bank the unbanked can also be considered a differentiating factor, potentially positioning them favorably amidst an industry struggling with regulatory scrutiny.
One of the prohibitive factors for blockchain adoption has been the environmental concerns surrounding it. Since Stellar uses a consensus protocol rather than a proof-of-work algorithm, it consumes significantly less energy compared with networks like Bitcoin, making it a more sustainable choice.
Despite its volatility and competition from other cryptocurrencies such as Ripple, Stellar holds substantial promise, both in terms of investment and its broader implications for the future of financial transactions. By focusing on efficiency, inclusivity, and green technology, Stellar is positioning itself as a forward-thinking choice for the cross-border transactions of the future.
