17 February 2021| ZebPay Trade-Desk
Stellar is built on an open network that allows money to be moved and stored safely. Since its inception in 2014, it has relentlessly served the purpose of boosting financial inclusion among participants through expanding the network’s global reach. Overtime, as technology developed and the Stellar network shifted its focus towards helping financial firms and institutions connect with one another through active participation on the blockchain.
Stellar makes it possible to create, send and trade digital representations of all forms of money—dollars, pesos, bitcoin, pretty much anything. It’s specifically designed to make traditional forms of money—the money people have been spending and saving for centuries—more useful and accessible. The Stellar network launched in 2015. Since then it’s processed more than 450 million operations made by over 4 million individual accounts.
XLM (Lumens), is the native token of the Stellar network. Unlike Bitcoin or Ether, lumens aren’t mined or awarded by the protocol over time. Instead, 100bn lumens were created when the Stellar network went live. In late 2017, approximately 50bn XLM tokens were burned, hence, as on date, the total supply of XLM tokens stands at 50bn.
Stellar (XLM) Snapshot (at the time of writing):
|24 HR Volume||$2,816,787,701.40|
|All Time High/Low||$0.9381 / $0.001227|
|Script in Circulation||22,397,093,520 XLM|
|Total Supply||50,001,803,495 XLM|
Stellar (XLM) is unique in its own right. Stellar charges a nominal fee for every transaction, as well as a minimum balance for every user, and hence makes transactions much cheaper and more efficient, compared to transactions that take place on the Ethereum blockchain which tend to be more expensive due to congestion on the network. Stellar is unique because every transaction costs just 0.00001 XLM. The Stellar network has also managed to gain the trust and backing of some global giants. Just a couple of years ago, Stellar and IBM launched World Wire, a tool that allows FI’s to transact on the Stellar network using bridge assets such as stablecoins.
Lastly, this network is highly sophisticated and secure. It uses the Stellar Consensus Protocol (SCP), to ensure decentralized control, low latency, flexible trust, and asymptotic security. The SCP is the backbone of the XLM token. The SCP whitepaper covers the functionality and technical architecture of this technology in incredible detail.
The below shows why XLM is in fact a popular as well valuable token. We have compared XLM, to similar tokens, which provide similar functionalities, though each token has its own subtle differences, and technical architectures.
|YTD Return (%)||131.21%||146.80%||143.68%||277.64%|
|Return from ICO (%)||9433.38%||1098.79%||63635.74%||16828.26%|
XRP is by the far the most similar token when compared to XLM. While Stellar’s aim is to expand access to low-cost financial services for all, Ripple aims to enhance the efficiency of cross-border transactions between banks and major FI’s.
OmiseGo is built on Ethereum’s network, and provides what is called the OMG Money Gateway as a scaling solution for Ethereum. OmiseGO aims to streamline transactions between payment processors, gateways, and financial institutions.
As seen in the table above, all these assets have shown phenomenal growth and returns, both in the short term (YTD), and in the longer term, since their respective launches. XLM, in particular, has been all the market players above, as it has since a significant spike in interest among the crypto community over the past few months, reflecting a ROI of ~225%. Both OMG and ETH remain a close second and third respectively, while XRP follows suit. With XRP now under the radar of the SEC, XLM is likely to be a direct beneficiary.
On the price action front, XLM has traded bullishly recently and continues to trend upwards. The volatility of the asset has shown although high when compared to traditional assets, is actually comparable when compared to the initial phase of other coins, making it a tradable asset in the short term as well. The token held its momentum, before taking a tumble, in 2017, when approximately 50bn XLM tokens were burned. However, since recovery the asset has been growing sustainably, and is showing promising signs of maturity in the crypto space. XLM has generated a significant amount of interest in the space and has become the leader in its space soon after it’s launch.
In a nutshell, Stellar has made it possible to create, send, and trade digital representations of major currencies, such as, dollars, pesos, bitcoin, and has the capability to imbibe pretty much anything. It’s designed to allow the world’s financial systems to integrate with each other seamlessly, and work together on a single network that is administered and governed by the SCP. It’s recent rise in popularity and applications over the past couple of years, has made it a force to be reckoned with, and is likely to only grow stronger and better over time.
Disclaimer : This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate. The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein. This report is preliminary and subject to change; the Company undertakes no obligation to update or revise the reports to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Trading & Investments in cryptocurrencies viz. Bitcoin, Bitcoin Cash, Ethereum etc.are very speculative and are subject to market risks. The analysis by Author is for informational purposes only and should not be treated as investment advice.