Is Stellar A Good Investment And Should I Invest In XLM?
Stellar Could Be Next 100 Billionaire Cryptocurrency!
Are you wondering if now is the perfect opportunity to buy Stellar? Or maybe due to negative market sentiment you are unsure if it’s safe to invest in Stellar?
If you haven’t been in the cryptocurrency world and particularly Stellar investing, you may be asking questions as to whether Stellar is a good investment or should I invest in XLM.
YES is the answer to the two questions. Stellar could be a good investment and investing in Stellar could bring huge returns in the future.
Stellar has increased substantially in 2021. The cryptocurrency returned 187.08% year-to-date by the end of 2021. With an eye on trade volume which defines activity on a digital asset, Stellar does not look like it's slowing down. This could be attributed to the $3,495,312,612 trade volume recorded as of 17th May.
Several analysts across the crypto finance space foresee a future of extensive growth of Stellar due to its open-source nature in the short term. Other analysts believe investing in Stellar is one of the greatest decisions any trader or investor can make for the long term. Therefore, May could be the right time to invest in Stellar (XLM) while the coin is trading at a relatively smaller price and it’s seeing massive investor interest.
One of the biggest reasons to invest in Stellar is its major upgrades which have improved the flexibility of the interaction of the Stellar Core and Stellar-based applications.
The upgrade became effective on 1st March 2020 and there are other major upgrades in the coming months which could see its Network open up to more innovative solutions in the space.
These are some of the reasons why investing in Stellar could be profitable.
In this article, we will take an in-depth look into all areas of business of Stellar which can help you conclude if you should consider investing in Stellar.
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- What is Stellar?
- Stellar Investing: Getting Started
- Is Stellar A Good Investment?
- Should I Invest in Stellar?
- Should I Invest in Stellar (XLM) or Ripple (XRP)?
- Will Stellar Overtake Bitcoin / Should I Invest in Stellar or Bitcoin?
- How Much Could Stellar Be Worth?
- Who Should Include Stellar in Their Portfolio?
- But, Is 2022 Too Late To Buy Stellar?
- Is Investing In Stellar Risky?
- Does Stellar Have a Future?
- How Safe Is Stellar?
- Conclusion: Is Stellar a Good Investment?
So, What is Stellar? A Simple Explanation
Stellar can simply be referred to as a network that aims to simplify cross-border payments. So, what about Stellar Lumens? Most often, due to consistency, the protocol, as well as its novel token, is simply referred to as Stellar.
To break it down, Stellar is the blockchain network that functions as a payment system that settles financial transactions.
At first, Stellar represented blockchain and cryptocurrency.
Currently, Lumens is the name of the novel token of the Stellar Network. It is denoted by XLM and powers the network. XLM is the symbol Stellar trades on cryptocurrency exchanges and brokerages.
The non-profit organization in Delaware called Stellar Development Foundation supports the network as well as cryptocurrency. It was created by Jed McCaleb and Joyce Kim in 2014.
XLM is one of the oldest altcoins in the crypto finance space. Stellar is the 24th largest digital asset in the world.
As a fork of Ripple, Stellar has found its feet in the areas of the decentralized finance space. While Ripple only serves centralized financial institutions, Stellar services the same centralized institutions as well as decentralized finance users through its decentralized applications (DAPPS).
DAPPS coupled with the hundreds of partners has created an ecosystem that sees XLM being used to settle millions of transactions daily.
Stellar Investing: Getting Started
To start investing in Stellar, you first need to register an account with a cryptocurrency exchange or brokerage. This will allow you to buy and invest in Stellar. An exchange such as eToro is credible and authentic to hold your XLMs on a safe and secure platform. eToro has been in business for a long time and has a license of operations from the governments of the United States and the United Kingdom.
Follow the steps below to register and invest in XLM.
The first step is to SIGN UP for an account. Please input authentic details of your full legal name, phone number and email, and residential address.
The second step is to VERIFY YOUR ACCOUNT. According to an article on CBS News, cryptocurrency scams have soared 1,000% since October 2020. As the popularity of cryptocurrencies continues to rise, so do online scams associated with digital assets.
This is the primary reason why you would be made to go through a Knowing Your Customer (KYC) phase. Under this phase, there would be a request to upload a government-issued identification card that confirms the details earlier on input.
If more questions are surrounding your accounts, you may be required to provide further proof of your details to confirm your residential address by uploading an internet bill or bank statement less than 6 months old. This helps eradicate identity and credit card fraud.
The third step is to DEPOSIT FUNDS. Upload funds in the form of fiat currency (what we all know as money). Your deposit can be in the form of USD, GBP, or EUR. This is highly essential for the purchase of your XLMs.
The final step is to NAVIGATE to XLM PAGE. On this page, you can purchase many XLMs which fit your investment goals. It would be processed, added to your account and you’d fully set towards investing in Stellar.
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Is Stellar A Good Investment?
According to experts at Digital Coin Price, Stellar is a good investment because it could have a trading price of $0.3719 by the end of 2022. The crypto news and prediction portal believe XLM could command prices of $0.4705 and $0.5503 in 2023 and 2024 respectively. This means that in the short and long term, Stellar is poised to increase substantially in market valuation. But what are the primary drivers behind such price forecasts?
Stellar has fostered partnerships with centralized institutions which are well-established. Corporations such as Deloitte, International Business Machines, Tempo Money Transfer, Coins.ph, TransferTo, and Flutterwave have employed Stellar’s Network for their software solutions.
As a result of Stellar being open-sourced, there is a possibility that the network could balance its cross-border payment solutions with decentralized finance in the future. With that said, in February 2021, Stellar seems to have formed a formidable partnership that gives its mileage in the DeFi space.
The novel token of Stellar, XLM, will be used to create XLM-backed tokens which could be used on decentralized applications such as the lending platform Uniswap (UNI). Overall, the backed tokens could be used on several DAPPS on the Ethereum platform through its partner Flare.
Stellar supports smart contracts on its network. Unfortunately, the Ethereum Virtual Machine is incompatible with Stellar’s smart contract feature. Flare serves as a bridge through the F-Asset Protocol and converts XLM and other cryptocurrencies into bridge tokens.
DeFi and the Global Crypto User Index
The Global Crypto User Index was a report by Binance Research that was released to the public on 28th January 2021, decentralized finance was featured strongly.
According to the report, “66% of all users said that they are using DeFi applications. DeFi appears to be most popular in Southeast Asia, where more than 54% of surveyed users reported using decentralized applications.”
Such a statistic on DeFi would go up when another study is conducted. This means that exposure to DeFi through Ethereum is contributing to the current valuation and daily volumes being recorded by XLM. If Stellar broadens its smart contracts feature and builds more user-friendly DAPPS, XLM could command 2 to 5 times its current price. This could increase the transaction count on XLM which currently stands at 5.79 million and worth $194.19 million.
With upgrades to facilitate more features, Wallet Investor estimates XLM could command an average price of $0.30 and a maximum price of $0.513 by the end of 2022. With that said, Stellar is an investment worth considering due to its potential on the market.
Should I Invest in Stellar?
Why should I consider investing in Stellar? Well, Stellar is an innovative technology that is helping all financial systems run on a single network as well as settling cross-border payments in a short time. Analysts at Coin Price Forecast think Stellar could close 2022 with a price of $0.34.
You should invest in Stellar because it is part of discussions that revolve around Digital Money 2.0 and money as a whole.
In 2021, it has become clear that digital currencies have come to stay. With a lack of regulation due to the decentralized nature of cryptocurrencies, many countries see it as a threat to the well-regulated currencies that govern their economies. This is why countries such as China have taken the lead in the use of Central Bank Digital Currency (CBDC).
Stellar has made a strong move by forging a beneficial partnership with the Ukrainian government. Using the possibilities of its blockchain, Stellar is going to build a digital national currency. This could see Ukraine become the first European country to adopt CBDC.
Aside from this, XLM is extremely accessible and can be found on the top cryptocurrency exchanges and brokerages worldwide. Dogecoin (DOGE) has recently surged in price due to its listing on Gemini and eToro in May. Trading on Binance, Huobi Global, and Coinbase Pro among a host of top names put XLM in the hands of millions of users. This brings more liquidity to the cryptocurrency and results positively in the valuation of the asset.
Moreover, XLM has a maximum supply that is subjected to scarcity in the future. It scales relatively faster than other blockchains due to its Stellar Consensus Protocol (SCP) which is capable of processing 1,000 to 5,000 transactions per second.
With the increasing daily volume and use rates, Stellar could reach high price milestones in the future. Experts at the Economy Forecast Agency, popularly known as Long Forecast predicts XLM to trade for a coin at $0.25 on 31st December 2022.
Check Out: Pros and Cons of Investing in Stellar
Should I Invest in Stellar (XLM) or Ripple (XRP)?
Investing in Stellar or Ripple is not risk-free. At the moment, XRP has been soaring thanks to breakthroughs Ripple continues to make in its case against the Security and Exchanges Commission (SEC).
This is the primary reason why it commands a relatively higher price than XLM.
Stellar is currently free from any cases with regards to XLMs being used as securities. The Stellar Development Foundation has accomplished two of its four milestones for 2021 and looks forward to bringing innovative minds to its ecosystem. This makes XLM an asset worth considering for investment.
Verdict on What to Buy (XLM or XRP)
It is a known fact by crypto and blockchain enthusiasts that Stellar is more decentralized than Ripple. But, from their partnerships, it could be deduced that the two cross-border networks are interested in forging lucrative deals with centralized financial institutions.
Since Ripple has a first-mover advantage in the global transfer space, it has been able to use its on-demand liquidity (ODL) feature through XRP to help thousands of its partners worldwide. The On-Demand Liquidity feature has helped settle millions of transactions.
If more financial institutions are supposed to choose between Stellar and Ripple, more than 50% would settle for Ripple’s Network since Ripple has several testaments to back its performance. This leaves Stellar in second place in terms of international transfer adoption.
On the other hand, Stellar is an open-source technology which means it can settle cross-border payments, be used to build central bank digital currencies, and has the feature of a smart contract that can build decentralized applications. If the issuing authority behind XLM opens up to new developers who would compete with Ethereum, Tron, Cardano, and EOS.io for DeFi users, more liquidity could be poured into the cryptocurrency.
Additionally, Stellar has targeted developing economies in helping provide easy financial assistance to the unbanked in those countries. More partnerships and developer activity could see sharp rallies in the price of XLM in the future.
As it stands, XLM is trading at a relatively cheaper price than XRP. As an e-learning organization, we’d advise diversifying your crypto portfolio with both digital assets. A bit of XRP and XLM could see huge percentage returns at the end of 2021 due to the potential of the teams behind the cryptocurrencies to form mainstream partnerships that come with huge investments.
Read More: Ripple vs Stellar
Will Stellar Overtake Bitcoin / Should I Invest in Stellar or Bitcoin?
It is not impossible, but it would be extremely difficult for Stellar to command a higher price than Bitcoin in the future. Although Stellar burned roughly half of its outstanding coins in November 2019, it still has 50 billion as its maximum supply. In comparison to BTC, digital gold has a maximum cap of 21 million. XLM has 24.20 billion in circulation while BTC has 18.92 billion in circulation.
Any new institutional investments which could drive the overall valuation of the cryptocurrency market could lead to BTC being mined 100%. This could see BTC head into scarcity when XLM is miles away from seeing all its coins purchased.
This is the main reason XLM cannot overtake BTC. Bitcoin moves the market and if it increases substantially in price, XLM could follow suit. Currently, the next price milestone analysts are targeting for BTC is $70,000 while XLM's next price milestone is reaching $1.
Based on the prices of cryptocurrencies, long-term buyers should invest in XLM if they don’t have the funds to buy a whole BTC. Short-term traders and investors should invest in BTC and take advantage of its multiple percentage swings to go short and long to make gains at the end of the day.
As always, carry on with fundamental analysis on the two cryptocurrencies. After that, you can read the more complex technical analysis. This would point you in a direction to decide on which of the two digital assets is worth your hard-earned money in terms of investment.
How Much Could Stellar Be Worth?
Several analysts and experts across different crypto news portals have made predictions of Stellar. Most of their forecasts answer questions such as what will XLM be worth in 1 year, what will XLM be worth in 2025 and what will XLM be worth in 2030? Let us take a look at some of these predictions.
Experts at Long Forecast believe Stellar (XLM) could trade for a price of $0.25 by the year’s end of 2022. The crypto analysis website forecasts XLM could exchange hands for $0.35 amid a bearish outlook for the cryptocurrency market in 2023. The crypto prediction website estimates Stellar to have a trading price of $0.22 by the close of 2024.
Analysts at Digital Coin Price think Stellar (XLM) could soar in the long term to $0.55 in 2024 and increase slightly to $0.57 by the end of 2025. The coin portal, which provides accurate crypto market analysis, further forecasts XLM to have a price of $0.54 in 2026 and $0.76 by the year’s end of 2027. In the long term, Stellar could still command a higher price of $1.01 in 2028, Digital Coin Price concludes.
Wallet Investor foresees an average price of $0.30 and a maximum price of $0.513 for Stellar by the close of 2022. The online portal which provides free-of-charge technical forecasts for cryptocurrency rates believes XLM could trade for average prices of $0.713 by the close of 2023 and $1.011 (2024). Experts at the website predict an average price of $1.595 for the digital asset by the end of 2026.
Coin Price Forecast is bullish as to what Stellar could be worth in the future. According to the experts at the online portal, XLM could trade for $0.34 by the close of 2022 and reach a high of $0.35 by the end of 2023. According to Coin Price Forecast, a price of $0.40 could be reached in December 2024 and $0.58 (2026).
What much is Stellar Worth in 2025?
According to Digital Coin Price, Stellar (XLM) could command a price of $0.57 by the end of December 2025. Experts at Coin Price Forecast predict $0.50 a price of XLM by the end of 2025. Wallet Investor believes Stellar could reach a price of $1.292 by the year’s end of 2025.
What Will Stellar Be Worth in 2030?
Coin Price Forecast foresees XLM trading for $0.81 on 31st December 2030.
Will Stellar Go Down In 2022?
As of the time of writing, XLM was trading at $0.2845 and had recorded a volume of $587,102,235. Recording such huge volume communicates huge trader and investor confidence in the cryptocurrency. With such statistics under keen perspective, Stellar is not going down in 2022.
Jason Lay is the Chief Operating Officer (COO) of San Francisco-based OK Coin. He has pointed out that since the inception of crypto, major announcements of new companies accepting crypto payments, new exchange listings, and new major investments have been the biggest and most consistent drivers of price movement.
Unfortunately, the developers of the Stellar Network are more focused on forging lucrative partnerships with major centralized finance institutions. As a result, there is little promotion to see to the adoption of XLM as an option of payment on online retail stores. With that said, XLM saw huge investments in 2021. In the early days of March 2021, it was announced that the largest digital asset management firm globally, Grayscale, has invested in 35 million XLM amid rising institutional interests in cryptocurrencies.
The Grayscale Stellar Lumens Trust was formed with $46.5 million in assets under management. A 390.86% return has befallen Grayscale since the launch of the Trust.
Thriving on the words of Jason Lau, new major investments in the league of Grayscale or above could see a substantial increase in the price of XLM.
With the market currently down after Elon Musk’s hold-up on the crypto finance market, an uptrend could ensue which could take XLM to new price milestones. Therefore, XLM is not going down.
UPTREND is where a coin reaches new high lows and with relatively cheaper prices entices new buyers to the asset to enable it to reach new high highs.
Don't Miss: Stellar (XLM) Price Prediction for 2025 and 2030
Who Should Include Stellar In Their Portfolio?
Several traders could benefit extensively from having XLM on their crypto portfolios.
- Blockchain Enthusiasts can make huge gains from Stellar. Stellar has one of the best blockchains in the decentralized finance space. As an open-source network, it can settle cross-border payments, facilitate the creation of Central Bank Digital Currencies (CBDCs) as well as build smart contract applications. This means that XLM which is the novel token which powers the network is being used in processing millions of transactions. With such activity on the token, blockchain enthusiasts can thrive on fundamental analysis to HODL the asset and make enormous returns.
- Cryptocurrency Traders are knowledgeable of XLM. They can include Stellar in their portfolio. Fundamental analysis and reading of technical analysis could inform traders about the future price patterns of XLM. This could help bring impressive gains from the digital coin to the traders.
- Day Traders have extensive access to digital assets on various exchanges and brokerages. XLM is volatile. XLMs 30-day volatility stands at 1.31 with multiple price swings daily. This would help experienced traders take advantage of the movements to go short (sell) or long (buy) on the cryptocurrency.
Check Out: Could Stellar Be A Millionaire-Maker Coin?
But, Is 2022 Too Late To Buy Stellar?
NO! It is not too late to buy Stellar. May has been a great month for altcoins to rally. XLM took advantage of extensive investor interest in altcoins in the early days of the month to increase in price. Fortunately or unfortunately, depending on how novice or experienced you are, the third week of May has gone bearish. The cryptocurrency market is down. With prices trading for relatively lower prices, this is the best time for you to get in on the action and buy some XLMs.
At $0.2845, Stellar is trading below $1. Buying 200 XLMs would cost you a paltry $56.90. At the same price, 500 XLMs cost $142.25 and 1000 XLMs would set you back $284.5.
According to Previsioni Bitcoin, Stellar could command a price of $0.45 on 31st December 2022
With the price of experts at the crypto prediction portal under perspective, you could be selling your XLMs on the last day of 2022 or 1st day of 2023 after seeing a 60.71% return on your investment.
Read More: Should You Buy Stellar XLM?
Is Investing In Stellar Risky? Could Stellar Be a Bad Investment?
Investing in Stellar and all cryptocurrencies is extremely risky. Risky investments are the ones that come with huge returns at the end of the day. Trading and investing in Stellar is a great way to balance your portfolio. Unfortunately, the high levels of unpredictability could see Stellar become a bad investment.
On Monday, 17th April, XLM reached an intraday high of $0.71. This was good news for investors who purchased XLM in the middle of March when it was trading for $0.39 per coin. Profit-taking soon took its toll on the cryptocurrency and a huge sell-off ensued. This saw a plunge in the price of the crypto trading asset in double figures by 12.68% to a low of $0.62 for the day.
With a relatively lower trading price when compared to strong rivals such as Bitcoin, Ether, Litecoin, and DASH, XLM could plummet further with a strong assessment of cryptocurrencies as securities by the SEC.
Invest a sum of money you can forget about. Better still; spread your investments around in several digital assets as well as less volatile assets like stocks, metals, and commodities.
Does Stellar Have a Future?
YES, Stellar has a future. According to analyst Anisa Batabyal at Coin Switch, “In a period of five years, Stellar will grow out to be one of the best performing cryptocurrencies, which means the rate of growth will be high.” The analyst estimates XLM will touch the $1 mark and end 2025 with a price of $1.14.
Trading Education has done extensive fundamental analysis to support the price forecast of Coin Switch. As per the roadmaps laid out by the Stellar Development Foundation, Stellar aims to support the robustness and usability of Stellar and be the blockchain people know and trust.
Fortunately, two of the key milestones have been reached in the first 5 months of 2021. As per data retrieved from the Stellar Development Foundation’s 1st Quarter Report, there was high user activity on the network. This signaled the extensive promotion done by the foundation.
The total accounts on the network grew by more than 10%. Total payments on the network grew by more than 160%. Total transactions processed on the decentralized exchange (DEX) of Stellar grew by more than 99%. The number of Relevant Assets on Stellar grew by more than 83% and the transaction volume of Relevant Assets also grew by more than 2,700%.
The last two milestones entail fostering & developing sustainable use cases for cross-border payments and open and supportive culture at the foundation which would bring new innovative minds to the project.
With new ideas, Stellar can improve on the number of decentralized applications running on its blockchain, CBDCs as well as NFTs. All these could take the price of XLM to new all-time highs which could see it break into the top 10 most valuable digital assets globally.
How Safe Is Stellar?
Stellar is extremely safe. For proof-of-work (POW) algorithm-backed blockchains such as Bitcoin, Ethereum, Litecoin, and Dogecoin, an attacker needs to acquire at least 51% of computation power to gain control of the network. Fortunately, the upgrade to the Stellar network which resulted in Stellar Consensus Protocol (SCP) makes its network asymptotically secure. Asymptotic Security is used in computationally securing cryptography.
What Are Alternatives To Stellar?
Although investing in Stellar could bring huge gains to investors, other cryptocurrencies can also result in high returns.
Stellar’s main rival XRP has performed well in 2021, currently has a price of $0.79.
Dogecoin is currently trading on the low side at $0.17.
EOS is backed by smart contract blockchains which record billions of dollars in daily volumes. It has a price of $2.89.
Cardano (ADA) may accomplish its milestones by the end of 2022 and shows great promise in the future. ADA has a price of $1.30.
Other cryptocurrencies of interest which come with relatively higher prices are ETH, DOT, LINK, and BTC.
As always, due to the unpredictability of the cryptocurrency market, invest with caution.
How Legit is Stellar?
Stellar (XLM) is a legit cryptocurrency. It is listed on the top cryptocurrency exchanges globally. Binance, Huobi Global, OKEx, CoinTiger, FTX, and eToro list the asset for trading. Additionally, Skrill allows wallet holders to buy, sell and hold XLM. XLM can also be used as an option of payment on SKRILL to settle transactions. Cryptocurrencies such as Tronix (TRX) and Dogecoin (DOGE) are not listed on Skrill due to the numerous controversies which have mired the two cryptocurrencies in the last months.
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Conclusion: Is Stellar a Good Investment?
Yes, investing in Stellar is worth considering. For thousands of investors, investing in Stellar has proven to be a great decision in the long term. With thousands of coins on the market, deciding to invest in XLM should lead you to the consideration of two factors. They are risk and reward. Do the possible rewards outweigh the possible consequences of the risks?
Stellar has a great future ahead in terms of accomplishing its milestones, forging new partnerships for the facilitation of cross-border payments, and a first-mover in the creation of CBDCs. On the other hand, Stellar has failed to command a relatively higher price, it’s undervalued, and it's far below the market capitalization of its rivals.
It may come as a surprise to millions of people that buying 100,000 XLMs on 1st January 2017 cost $250. On 11th May 2021, XLM closed at $0.73. Holding onto the cryptocurrency for 4 years could have netted the HODLer $73,000 (a return of 29,100%).
So is Stellar a good investment? As of the time of writing, Stellar is considered a good investment? And, if you are looking to invest in XLM, May could probably be the time to decide on the cryptocurrency.
While no cryptocurrency investment is risk-free, investing in Stellar has generated more than 187.08% in 2021. Whether you are new to Stellar investing or a newbie who wants to make the most out of your investment, understanding what to know before investing in Stellar is critical to making enormous profit.
Thriving on bullish predictions, Stellar is a good investment and investing in Stellar now or the future could bring gains that could shield potential losses.
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