Is XLM Good for Long Term Holding?

Bittime -  Stellar Lumens (XLM) has become one of the cryptocurrencies that is attracting attention in the market, especially due to its focus on fast and cheap cross-border payments. 

With the primary goal of facilitating financial transactions globally, Stellar offers an alternative to traditional financial systems by lowering transaction costs and eliminating delays. 

However, as cryptocurrencies develop, is XLM worth investing in in the long term?

What is Stellar Lumens (XLM)?

Stellar Lumens (XLM) is a digital currency used on the Stellar network, designed to make it easier to send money between countries at lower costs. 

By using Lumens as a bridge, Stellar allows users to convert currencies quickly without the high fees typically associated with international payments. 

Fast Currency Delivery Via Stellar

For example, when sending US dollars to Euros, Lumens helps find the best rate for a fast and secure transaction.

Stellar also plays a role in real-world applications. This network makes it easy to send and receive money globally. 

Lumens are used as a link between different currencies, ensuring senders and recipients get the best exchange rate. 

Lumens has been used by large companies

Several large companies such as IBM and MoneyGram have used Stellar for their transactions, showing how useful this system can be in the world of finance.

Key Features of Stellar

Cross-border payments with very low fees.

Anchors, which serve as intermediaries to connect fiat currencies with the Stellar network.

Decentralized exchanges (DEX), allow direct currency transfer between users without intermediaries.

Is Stellar Lumens (XLM) Worth Buying?

XLM has experienced significant price fluctuations over the years, making it the subject of debate regarding its investment potential. 

XLM's main strength lies in its utility for cross-border payments, with backing from big names like IBM and MoneyGram lending it credibility. 

To determine if XLM is a good investment, here is a step-by-step guide:

Stellar Lumens (XLM) Price Trends

XLM hit an all-time high of $0.93 in early 2018 during the cryptocurrency boom. 

However, after the market cooled down, XLM experienced a sharp decline and struggled to return to those levels. 

Read too Record Outflow Reaches $63 Million, Bullish Signal for XLM to Compete with XRP?

XLM Price Prediction for 2024 - 2025

In 2021, XLM experienced a resurgence with a peak around $0.73, but has since stabilized around the price range. 

As of October 2024, XLM is trading between $0.09 and $0.16, slightly lower than previous estimates, but still showing growth potential depending on market conditions.

Source: Coinpedia

XLM price predictions for 2024 suggest that the price could reach between $0.25 to $0.31, although this is highly dependent on broader cryptocurrency trends. 

Some projections for 2030 are optimistic, estimating prices between $1.2 to $1.5. 

While these numbers provide hope for long-term investors, the volatile nature of cryptocurrencies means that these estimates should be approached with caution.

How Does Stellar Lumens (XLM) Work?

Stellar Lumens (XLM) serves as the digital currency behind the Stellar network, designed to facilitate fast and cheap international payments. 

Stellar Connects Banks and Individuals

The Stellar Network connects banks, payment systems and individuals, enabling seamless transfers between currencies. 

One of Stellar's key features is its ability to provide cross-border payments quickly and efficiently, as well as with low fees. 

This makes it a strong option for businesses and individuals who want to send money abroad without relying on traditional financial systems.

Stellar's Unique Consensus System (XLM)

Stellar uses a unique consensus system that does not require energy-consuming mining, making transactions faster and environmentally friendly. 

Each transaction requires a small fee (0.00001 XLM), and users must maintain a minimum balance of 1 XLM, ensuring the network remains safe and efficient. Besides that, 

Stellar has forged key partnerships that help drive adoption, such as its collaboration with MoneyGram for real-time crypto-to-fiat transfers.

Considerations for Traders if They Want to Hold Long Term

When considering a long-term hold investment in Stellar Lumens, traders should focus on several important points:

1. Price Volatility

XLM has experienced large price fluctuations over the years. Even though there is potential for profit, the risk of loss is also significant, so traders must be careful and stay abreast of market trends.

2. Real World Use or Utility 

Stellar's main goal is to speed up and reduce the costs of international payments. With partnerships like IBM and MoneyGram, the platform is gaining practical use which could increase the demand for XLM.

3. Regulations

Like all cryptocurrencies, XLM is affected by changes in government policy. It's important to stay up to date on how regulations, especially those related to cross-border payments, may impact pricing and usability.

4. Technology Update

The use of efficient consensus systems and the introduction of smart contracts can expand their role in decentralized applications (DeFi) and financial services. These upgrades may increase in value over time.

Read too XRP vs XLM: Fundamental and Technical Comparison

Conclusion

Overall, Stellar Lumens (XLM) shows potential as a long-term investment, especially with its strong partnerships and utility in cross-border payments. 

However, investors should remain alert to market volatility and regulatory developments that could affect the future value of XLM.

FAQ

Is It Worth Investing in XLM?

Investing in Stellar Lumens (XLM) can be considered an attractive option, especially considering its strong partnerships with large companies such as IBM and MoneyGram. 

XLM is designed to facilitate fast and cheap cross-border payments, which makes it relevant in the global financial ecosystem. 

Does XLM Have a Future?

The future of XLM looks promising, especially with the optimistic price projections from various analysts. 

Some predictions suggest that XLM could reach a price of between $0.60 to $1.00 by 2030, depending on technology adoption and growing partnerships. 

Stellar is also involved in important projects such as the Central Bank Digital Currency (CBDC), which could increase its relevance in the market.

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Reference

Rinat G., What Is Stellar Lumens (XLM) And Should You Invest, Accessed December 10, 2024

Brandy Woodfolk, Stellar (XLM): What You Need To Know Before Investing, Accessed December 10, 2024

Elena R, Stellar Price Prediction 2024, 2025 – 2030: Will The XLM Coin Reach $1?, Accessed 10 December 2024

Author: IN