Stellar Lumens (XLM) is a digital asset valued at $0.12 as of October 3. This cryptocurrency is commonly used in banking and online payments. Users like it because the operations are processed instantly and at a relatively low cost. The XLM coin runs on its native Stellar blockchain, which is different from the majority of decentralized networks mainly because it applies its own Stellar Consensus Protocol. Here, you cannot mine XLM coins.
The main function of the platform is the acceleration of financial operation. This is relevant for both P2P and corporation-based activities. The network will automatically convert your fiat currency into XLM, send it quickly, and then, convert it back into the initial payment method.
Why is the future of Stellar Lumens doubted?
We’ve just answered the question of what is Stellar Lumens. Now, we have to figure out why some experts are hesitant about the future of this cryptocurrency. We managed to discover several key reasons:
The Stellar blockchain is controlled by the Stellar Development Foundation which holds the amount of tokens worth $30 billion, which aren’t available to the public yet. This centralization can make the XLM coin less attractive to investors.
Centralization of the network is also enhanced by the number of eligible validators, which is only about 50. Such a model of work makes this network vulnerable to the attacks of hackers.
Account maintenance is not free for its users. You must hold at least 1 XLM in your balance.
Stellar Lumens is a highly volatile cryptocurrency. On the one hand, it may cause beneficial price fluctuations. But on the other hand, the price decrease might be very unexpected.
How Stellar Lumens Works
Every server of the Stellar system runs on a decentralized ledger, which is regularly updated every 2-5 seconds. Transactions that take place within the ecosystem are tracked with the ledger. It’s also used to store account balances.
As in any other blockchain system, the financial operations on Stellar are validated by special nodes. However, in this case, these nodes might be eligible only if they run on the core Stellar software. As a rule, it takes no more than 5 seconds to process a transaction.
The transaction might be executed if it’s approved by all the nodes within the set. Such an approach allows the blockchain to process over 1,000 operations per second. The Bitcoin network, to compare, executes only 7 transactions per second.
The network is very suitable for cross-border transactions because it provides fast execution at relatively low costs. That is the reason why many businesses apply this blockchain. IBM is one good example of such a business.
How Stellar Lumens Works
Every server of the Stellar system runs on a decentralized ledger, which is regularly updated every 2-5 seconds. Transactions that take place within the ecosystem are tracked with the ledger. It’s also used to store account balances.
As in any other blockchain system, the transactions on Stellar are validated by special nodes. However, in this case, these nodes might be eligible only if they run on the core Stellar software. As a rule, transactions are processed within 5 seconds.
The transaction might be processed only if it’s approved by all the nodes within the set. Such an approach allows the network to process over 1,000 transactions per second. The Bitcoin network, to compare, executes only 7 transactions per second.
The Stellar network is very suitable for cross-border transactions because it provides fast execution at relatively low costs. That is the reason why many businesses apply this blockchain. IBM is one good example of such a business.
XLM price predictions
In order to figure out whether Stellar Lumens has a future, we need to take a look at its price predictions. They might be very different. That’s why, before you decide to make an investment, conduct your own fundamental and technical analyses.
2023
As of the date of writing this review, the XLM coin is traded at $0.12. In 2023, it’s expected to reach the point of around $0.21. We expect that it will be its maximum price in the following year. The average price projected will be around $0.17. However, there are some more optimistic forecasts for the XLM future.
Some experts say that in 2023, the XLM coin might stabilize at the minimum point of $0.23, while its maximum price is expected to be $0.27. The most optimistic forecasts will become true if the Stellar blockchain network manages to take its place between technologically-advanced and traditional financial infrastructures. This system has all the capabilities to achieve this if it improves the transactional volume. We dare say that if there were no risks related to centralization, the Stellar network would be able to achieve this in shorter terms.
2024
Forecasts of experts for 2024 are less optimistic than price predictions for 2023. The majority of specialists don’t expect the XLM coin to exceed its 2023 price in 2024, meaning it will stay somewhere around $0.16-0.24
There are some optimistic predictions for XLM. According to them, the cryptocurrency will be traded at around $0.33-0.40 in 2024. Taking both pessimistic and optimistic predictions into account, we can say that the price gap of the XLM coin in 2024 will be around $0.22-0.28.
2025
2025 is expected to be a successful year for XLM investors since it’s expected to break the price of $0.30. The forecasts say that the minimum price of XLM throughout 2025 will be around $0.24.
The most optimistic estimates say that in 2025, the XLM price will exceed $0.35 and will be traded at around $0.35-0.44. Such optimistic predictions are driven by the expectations of the introduction of decentralized applications on the Stellar network. If this happens and becomes successful, the XLM price will perform an extremely high surge – the price is projected to vary in the range between $1.75 and $7.75!
2029
These are very optimistic predictions that can come true if the network introduces decentralized applications in 2025. However, in the long run, the forecasts are also rather optimistic. By 2029, the XLM coin is expected to be valued at around $2.20. Even pessimists expect it to reach $0.60.
Conclusion
Even despite the risks of centralization, we believe that the Stellar Lumens cryptocurrency has a good future. Currently, it holds the 25th position in the list of the best coins by market cap. The introduction of new technologies and improvement of current services can greatly improve this
