Lumen Crypto: Smart Investment Or Risky Business?

Stellar Lumens (XLM) is a cryptocurrency that facilitates quick transactions at low fees, making it ideal for international money transfers. It also has a built-in decentralised exchange that allows for seamless trading between cryptocurrencies. XLM gained popularity during the 2017 crypto hype bubble and rose to become one of the top ten cryptocurrencies by market cap. However, due to poor performance during the cryptocurrency bear market, it has since lost its place in the top ten.

XLM has strong partnerships with major companies like IBM and Deloitte, lending it credibility. It also has a good use case and has proven to be competent in performing it, making it a good investment. While the forecasts do not expect its price to be particularly profitable in the short term, in the long term, it is predicted to increase.

Lumen's performance in 2020 renewed investor hopes

Stellar Lumens (XLM) is an altcoin that trades under the symbol XLM. It gained popularity in 2017 during the ICO craze that sent cryptocurrency prices soaring. Stellar Lumens was designed to be the fastest project for making international transactions, with the ability to process payments almost instantly.

XLM's strong performance in 2020 renewed investor hopes that it may achieve some of the price predictions made by experts. In 2020, Stellar Lumens rose to a three-year high in just two weeks after the Stellar Development Foundation (SDF) published its 2021 roadmap. The price surge was also attributed to the announcement of the USDC launch on its network.

XLM began its slow yet steady hike at the start of 2020, going from $0.0125 to $0.3560 in four days. The coin traded sideways with small fluctuations until late January, when it entered another uptrend. The steady growth turned into a sharp surge around February 10, likely influenced by Bitcoin and Ethereum's major price increase. XLM skyrocketed to $0.57 by February 13. After the hype, the price dropped to a support level at $0.5, followed by another drop to an average price of $0.4 around February 22.

Despite a poor performance during the cryptocurrency bear market over the past few years, Stellar Lumens' performance in 2020 renewed investor hopes for its future prospects.

Lumen's price surged in response to the project's latest roadmap

On January 29, 2021, the Stellar Development Foundation (SDF) published its 2021 roadmap, which was comprised of three strategic pillars: supporting the robustness and usability of the project; helping it to be a trustworthy blockchain; and fostering and developing sustainable use cases. The project also had a particular focus on transparency.

The price of the project's native coin, Stellar Lumen (XLM), started to increase immediately after the announcement, reaching a three-year high in just two weeks. The XLM price surged in response to the project's latest roadmap, as well as the announcement of the USDC launch on its network.

On January 3, 2021, XLM saw a significant price movement, going from $0.0125 to $0.3560 in only four days. After a slight correction, it traded sideways with small fluctuations until late January, when it entered another uptrend. The steady growth turned into a sharp surge around February 10, likely caused by Bitcoin and Ethereum's major price increase. XLM skyrocketed to $0.57 by February 13. After the hype passed, the price dropped down to a support level at $0.50, which was then followed by another drop to an average price of $0.40 around February 22.

The XLM price surge in early 2021 may also have been influenced by XRP after Ripple was sued by the SEC for selling an unregistered security.

Stellar has strong partnerships with major companies

Stellar Lumens (XLM) is a cryptocurrency that gained popularity in 2017 during the ICO craze, becoming one of the top ten cryptocurrencies by market cap. Stellar has strong partnerships with major companies, including Visa, Tala, and Circle. This partnership allows unbanked users to access the USD Coin stablecoin in a digital wallet, enabling them to make cross-border transactions and access crypto services. Visa will also issue cards linked to these wallets, allowing users to spend their crypto balance at over 70 million merchants worldwide.

Stellar has also partnered with IBM on their hyperledger project, giving the project credibility in the crypto space. The Stellar Development Foundation (SDF) has further strengthened Stellar's position by focusing on transparency and publishing its 2021 roadmap, which includes supporting the project's robustness and usability, fostering sustainable use cases, and enhancing its trustworthiness as a blockchain.

In addition to its partnerships, Stellar has a growing list of anchors and integration partners, including fiat issuers, on and off-ramp service providers, and companies building on the Stellar network. These partnerships and collaborations demonstrate the strong support and potential for Stellar Lumens in the cryptocurrency space.

XLM has a good use case

One of XLM's biggest selling points is its asset exchange system. This system allows for instant cross-asset exchanges, enabling users to pay someone in one currency and have them receive it in another. For example, a user could pay someone in USD and have them receive it in EUR. This feature has massive potential for cross-border transactions and international payments, which is one of the main use cases for XLM.

Another key feature of XLM is its low fees. The fee for transactions is set at 0.00001 XLM, making it much cheaper than traditional financial institutions and even other cryptocurrencies like Bitcoin. This low-fee structure makes it an attractive option for users looking to send or receive money internationally.

XLM also has a strong focus on transparency and has partnered with well-known companies such as IBM, Deloitte, and Stripe. These partnerships give credibility and validity to the project and signal that it is a good investment option.

In terms of price, XLM has seen some volatility but has generally been on an upward trajectory. While it did experience a drop in value during the "crypto bubble" pop in 2021, it has since recovered and is expected to increase in value over the long term. Some analysts predict that XLM could reach as high as $50 by the end of 2030, although this is an outlier prediction. More conservative estimates place XLM at around $1 by 2025 and $1.30 by 2030.

Overall, XLM has a good use case and is a competent cryptocurrency with a strong track record. Its focus on cross-border transactions, low fees, and strong partnerships make it a good investment option for those looking to diversify their portfolio and invest in a cryptocurrency with a solid foundation.

XLM has a solid team behind it

Stellar has also established a working partnership with one of the largest tech companies in blockchain, IBM. IBM and Stellar have a working blockchain product that uses Stellar Lumens in the South Pacific. The project connects retailers in some of the most isolated islands in the Pacific Ocean. This partnership is significant because it is already in motion and demonstrates that McCaleb is doing big things with some of the biggest names in the blockchain, which is very exciting for Stellar investors.

In addition to IBM, Stellar's partners include MoneyGram, Circle (the company behind USDC), Stripe, Deloitte, and ICI Bank. These partnerships demonstrate that Stellar has a solid team and strong backing, which could contribute to its long-term success.

Frequently asked questions