How To Make (or Lose) Money With Stellar Lumens (XLM)

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Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Last Updated January 13th 2022
7 Min Read

Today, there are as many ways of making money with Stellar Lumens, as there are of losing it all. It, therefore, is not enough to learn about the different ways of making money with XLM, you also need to learn from the mistakes of others. Learn how they lost money investing in Stellar Lumens, or any other crypto investment, and take practical steps towards safeguarding your investment and ensuring that you keep as much as you make.

In this post, we will be discussing the most common ways of making a fortune with Stellar Lumens XLM. But even more importantly, we will show you how you can protect this investment and the profits it brings by detailing the ways you can lose XLM and how to avoid them.

We start by exploring the most common ways of making money with Stellar Lumens.

How To Make Money With Stellar Lumens (XLM)

Although XLM tokens were originally designed to facilitate transactions on the Stellar network, they have received greater adoption and acceptance as a speculative investment tool. Here are the three most common ways in which you could make money with XLM.


Trading involves buying XLM coins, selling them later at a higher price, and repeating this process multiple times, making little profit with every trade. You could choose to be the aggressive day trader who opens and closes multiple XLM trades throughout the day - mostly trading XLM CFDs - or the more conservative position/swing trader who opens an XLM trade and rides this trend for days. 

Trading is by far the most common way of making money with XLM. To succeed here, however, you need rich crypto trading experience, enough capital investment, and access to highly advanced trading and analysis tools.


Investing is the most common form of making money with Stellar Lumens XLM. It involves buying XLM coins today and holding on to them for a long time, believing that their value will continue rising in the foreseeable future. Investors, unlike traders, aren’t afraid of the short-term volatilities and will, therefore, not close their traders even after the most devastating price dip - as it happened in mid-May 2021 when XLM value dropped by more than 70% in less than 10 days.

Stellar Lumens investors believe in the token’s sustainability. Taking a cue from its net-positive ROI, XLM investors are confident that the digital currency’s price will always rebound and rise above the previous all-time high. To understand how much you can make investing in the 28th largest cryptocurrency, you only have to look at its overall ROI of 6,072.64%+, noting that more than 125% of this was accumulated in the last year.


With the rise of DeFi platforms, there now are numerous platforms that reward you for staking XLM coins. These include the Staking Rewards platform that promises 1% per annum on staked XLM amounts and even the Binance-owned Trust Wallet.

Like long-term investing, staking earns generates passive income for the XLM investor. Unlike trading, it doesn’t require you to keep watch over the market or to closely monitor the altcoin’s price action. Importantly, you get to earn doubly when you stake XLM coins - from value appreciation and also from the interest/reward provided by the staking platform.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

How To Lose Money With Stellar Lumens (XLM)

Just as there are many success stories of individuals that earned a fortune investing in Stellar Lumens, there also are numerous sad stories of individuals who lost money with XLM. In here, we look at the four most common ways through which XLM investors lost money and how to protect your Stellar Lumens from each.


Trading, though the commonest way of making money with XLM investing, is also highly risky and one of the leading causes of money loss to XLM investors. Just as you make money when the value of XLM tokens appreciate, you lose when it dips. You, however, need to note that this loss is always impermanent - implying that it only comes to effect if you decide to sell.

There are two measures you can take to safeguard your investment and ensure that you aren’t whipsawed into making losing a lot of money with an XLM investment. The first and most important, ensure that you have mastered the art of active crypto trading before you deposit actual funds into a trading platform. Only start trading when confident enough that you have gathered enough crypto trading experience. Secondly, don’t be too quick to sell. The token’s price history is evidence enough of its resilience and ability to rise again, even after the most scathing price dip.


Investments in Stellar Lumens, and any other crypto for that matter, expose your money to the risk of loss to hackers. When investing in XLM, you need to understand that the number of individuals and groups of individuals who have taken up hacking as a career is on the rise.

These target crypto wallets - both individual and exchange-owned - as well as databases. They are looking to either steal XLM and crypto held in wallets and exchanges or personal information that they can use to infiltrate investor wallets and exchange accounts.

Verizon recently reported that more than 80% of all data breaches were made possible by weak passwords. Therefore, the first step to guarding your XLM investment against loss to hackers is using unique and strong passwords for both the wallet and crypto exchange accounts.

Additionally, activate multi-factor authentication for wallet and account log-in and crypto transfer - virtually all crypto trading platforms and wallets support two-factor authentication. Where possible, consider investing in ultra-secure hardware wallets as they store your XLM coins offline.


The Federal Trade Commission (FTC) reports that crypto-related crimes have been on a steady increase for the past few years. Some of the most common tactics that scammers have employed in stealing XLM coins include Ponzi and pyramid schemes, phishing, imposter websites, and fake DeFi programs.

Most of these are hard to detect, which makes them all the more lethal, especially when you consider that the deregulated nature of the crypto industry doesn’t provide much recourse to help you track and recover funds lost to scammers and hackers.

There nevertheless are a few measures you can take to protect your investment from these scammers. For starters, you can rest avoid chasing get-rich-quick schemes in the name of investment programs that promise higher than average returns.

Secondly, avoid clicking on suspicious and unsolicited links sent to you, whether on social media or email. More importantly, keep abreast with the crypto industry news and security analysis reports to learn of new scams - since they adapt regularly - how they operate and how to avoid them.

Read Also: Is Stellar Lumens (XLM) Safe?

Bottom Line: How To Make Or Lose Money With Stellar Lumens (XLM)

There are multiple straightforward and highly rewarding ways of making money with Stellar Lumens - including investing, trading, and staking XLM tokens. But there also are multiple ways of losing money and profits earned with XLM investing. The most common being loss to hackers, to unprecedented price dips, scammers, or even lost password and recovery seeds for crypto wallets.

If you are to keep the money made from XLM trading and investing, you need to learn of the different risks facing these investments and take practical steps to guard them. These steps may take the form of getting a hardware wallet, embracing risk management, activating security measures provided by an exchange, and researching different scams and how to avoid them. 

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