Stellar is a technology designed to simplify the movement of finances between people and between companies. The authors of the project strive to make it as easy to make money transactions as, for example, communicating via e-mail. It will increase the availability of financial transactions for ordinary people around the world, and banks and businesses will reduce their costs.
Stellar was founded by Jed McCaleb as an offshoot of Ripple. It was originally created on the Ripple blockchain, but in 2015 it created its own original open-source protocol. The Stellar platform was launched in 2014, and the platform was rebranded in 2015. Stellar tokens were renamed Lumens to avoid confusion, as the token originally had the same name as the network.
What is the reason for the separation of Stellar from Ripple?
Ripple is a fully centralized platform run by Ripple Labs, which controls a large number of XRP tokens. The cryptocurrency’s source code was closed until 2013. All tokens for a long time were the property of Ripple Labs, their distribution depended solely on the will of the company’s management. All this caused dissatisfaction among users.
Stellar was conceived by McCaleb as a platform with the advantages of Ripple, but devoid of its disadvantages. However, Stellar failed to displace Ripple from the market, and subsequently, both cryptocurrencies developed in parallel.
Stellar Lumens Wallets
There are currently more than 20 wallets (hardware, desktop, mobile, and online wallets). You can choose any of them depending on your goals. For the daily use of Lumens preferred Stellar Web Wallet because of its simplicity and convenience. But long-term storage of a large number of XLM tokens is recommended with hardware wallets.
Stellar technology: its features and characteristics
The main advantage of Stellar is considered the scalability of the platform and open-source code. The system easily copes with several thousands of transactions per second, and the confirmation of transactions is carried out in no more than 5 seconds. Another important advantage of Stellar is that the platform allows exchanging cryptocurrencies and fiat currencies, tokens, and other assets thanks to SCP technology, which compares favorably to the PoW protocol. In addition, today it is possible to use smart contracts and multi-signature Stellar, which extends the functionality of the network.
The main advantages are
- open-source code;
- equal rights for network participants;
- the ability to create a large number of micropayments in the Stellar system;
- loyal commissions for transactions and operations in the Stellar network;
- interoperability of the Stellar Lumens platform with other financial market products;
- Possibility to work with any type of currency within the Stellar Lumens platform;
- Work in real-time;
- use of cryptographic encryption to enhance security;
- automation of the token exchange procedure;
- the ability to build clients and plugins based on the Stellar Lumens protocol.
Features and characteristics
- Possibility to use any currency or asset for sending or exchanging.
- Decentralized.
- 3-5 second confirmation.
- Open source code.
- Uses SCP rather than Proof of Work.
- Multi-level and smart contracts.
- 100B XLM created initially.
- 1% per year artificial fixed inflation.
- Unable to mine because all coins were created originally and the number of coins is constant.
Disadvantages
Speaking about the disadvantages of Stellar Lumens, we can note the need to pay a fee for transactions within the system, but the cost of the transaction is insignificant and is 0.00001 XLM.
Also, not all users may like the mandatory minimum balance required on the account, the amount of which is 20 Lumens. However, it cannot be considered a disadvantage because this condition frees the Stellar network from a large number of spam accounts, which do not bring the project and users any benefit.
Where to buy Stellar Lumens (XLM)
Stellar tokens (XLM) are presented on all popular exchanges: Binance, Bittrex, Poloniex, Kraken. Please note, that direct exchange of fiat currency to Lumens is not possible. First, you need to buy one of the Stablecoins (e.g. bitcoin) on the exchange, and then exchange it to XLM.
Stellar (XLM) Forecast for 2021
For most of 2019 and 2020, the outlook for XLM seemed bleak. After a bearish breakout in October 2018, XLM consolidated below the $0.20 area. XLM formed a bottom on March 13, 2020, at $0.024, after which a steady recovery began.
The pace of growth accelerated in November, and in early January 2021 Stellar developed a cosmic speed, “jumping” from $0.12 to $0.32 in one week. The historical maximum of $0.6 was reached on February 13, after which the correction began. At the moment of writing this article, the value of XLM is at the level of $0.40.
The nature of the rally from the March low suggests that Stellar (XLM) is most likely at the end of the first wave of the five-wave bullish momentum, and soon the growth will resume. The coin is likely to rise above the $0.47 resistance area in the second half of 2021 and test it as support.
However, XLM is unlikely to be able to end the bull cycle in 2021. The point is the length of the first wave, which has dragged on for seven months.
If it takes the same amount of time to form the second and third waves, the third wave will end around October 2021, and we will see the fourth and fifth waves in 2022. A new historic high will probably be reached then.
So, apparently, Stellar (XLM) has entered the long-term uptrend. The dynamics will continue during 2021 and will lead the coin to record highs.
In the long term, the rate of Stellar (XLM) primarily depends on the number of cooperation agreements signed, not only with financial institutions but with various companies. One of Stellar’s most important achievements was the start of collaborations with IBM in 2017. It is the collaborations that make XLM grow.
According to experts, the cryptocurrency Stellar Lumens may become one of the world’s leading platforms in the future. Such predictions appeal to investors who invest significant amounts in cryptocurrency in order to increase their own capital.
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