skip to Main Content
Stellar Cryptocurrency


Stellar is an open-source protocol for sending, receiving, and trading both regular and crypto currencies at practically no cost. It comprises a network of decentralised servers that power a distributed ledger, which records every transaction in the system.

Servers communicate with each other to verify these transactions and sync the ledger every 2-5 seconds, which records money as credit. This is then issued in an online account (like a virtual wallet) in exchange for a deposit. Issued credit can be sent between people on the network, which automatically converts it at the lowest rate.

At launch, Stellar was based on the Ripple protocol. However, the Stellar Development Foundation created an updated version of this protocol with a new consensus algorithm based on entirely new code, which went live in November 2015.

Several non-profits and businesses are implementing Stellar as financial infrastructure. In October 2017, IBM and payments network KlickEx named Stellar as the backbone of its new “cross-border payments solution.”

Stellar strengths and attributes

Even though Stellar is a non-profit organisation aimed at creating a more inclusive world economy, you need network tokens known as Lumens (XLM) to:

  • Exchange currency – XLM can act as a universal unit of exchange for transferring currencies
  • Accessibility – You need to hold at least 20 XLM to use the Stellar network
  • Operation fee – A fee of 0.00001 XLM is charged to senders for each operation to discourage DDoS attacks


Stellar can be described as a matchmaker for currencies because it facilitates transfers and exchanges in any currency. You can do this by:

  • Direct exchange – If you want to trade GBP for USD and somebody else wants to trade USD for GBP, Stellar will match you up and automatically carry out the exchange for your requested amount.
  • Exchange via XLM – It can use its own XLM (Lumen) tokens as an intermediary currency for when the amounts don’t add up or there isn’t a direct exchange available. It will find offers for both XLM and the requested currencies before handling the exchange.
  • Chain of conversions – When there are no other options available, Stellar will attempt to handle the currency by finding a chain of conversions, such as GBP to AUD to EUR to USD.

Price and volatility

Ever since Stellar partnered with IBM, the price of XLM has continued to climb. Two weeks into 2018, XLM rose from US$2.5 billion to over US$12 billion, even though several other currencies saw their market caps slip amid a crypto correction.

On 24th January 2018, XLM climbed again by over 20 per cent after online payments company Stripe said it may add support for the cryptocurrency. According to CoinMarketCap, XLM soared 21.2 per cent, giving it a market value of around US$10.3 billion. As a result, it became the six-largest cryptocurrency by market cap.

Speaking with finance website, fintech experts predict that Stellar’s market cap could rise to US$183 billion by the end of the year. This would mean the value of XLM would climb more than 1700 per cent in 2018, vastly outpacing forecast for other cryptocurrencies like Bitcoin and Ethereum.

Back To Top