The cryptocurrency market maintains a bullish position with Bitcoin at the forefront leading this trend. Its dominance of over 52% is sending a strong message that investors who bet on its rise after analysts have predicted are not wrong.
Although, the great flow of capital is concentrated on the leading cryptocurrency, it is not negligible that the rest of the market presents opportunities for many investors who bet on the altcoins’ market. Such is the case of Stellar (XLM), a project that is in itself quite interesting because it is one of the cryptocurrencies that has been proposed (and has achieved to some extent) to create a new decentralized global financial system beyond the limits of Bitcoin.
History and Evolution of Stellar (XLM)
The project was born in 2014 through Jed McCaleb, founder of Mt.Gox Exchange and the co-founder of Ripple, together with lawyer Joyce Kim.
Before the official launch, McCaleb created a website called “Bitcoin’s Secret Project” in search of alpha testers for this Stellar network. A short time later, he created the Stellar Development Foundation, in collaboration with Patrick Collison, CEO of Stripe. Finally, in July of the same year, Stellar was officially launched.
Stellar managed to raise a total of 3 million dollars from investors during its ICO and had an initial deployment of 100 billion lumens.
By January 2015, Stellar had approximately 300 thousand user accounts registered on its platform and its market capitalization was almost $ 15 million. The new algorithm called SCP (Stellar Consensum Protocol) was created by Professor David Maziéres of Stanford.
Lightyear.io, a for-profit entity of Stellar, was launched in 2017, as the commercial arm of the company. In September 2017, Stellar announced a benefits program that would grant partners up to $ 2 million in lumens for the development of the project. In September 2018, Lightyear Corporation acquired Chain Inc. and the combined company was called InterStellar.
Technical Features of Stellar Lumen (XLM)
Stellar is an open source project whose main repository is hosted on GitHub, so the project guarantees that its code can be widely used in free and closed projects. This creates a broad development ecosystem in which everyone benefits from the common software.
Stellar presents a series of unique features such as the Stellar consensus protocol (SCP) with which the network builds the Federated Byzantine Agreement (FBA), along with many similar mechanism for fault tolerance distributed in a financial network like other cryptocurrencies with some different variations.
With this, the Stellar network achieves: decentralized control, low latency, flexible confidence and asymptotic security.
The network in turn comprises three major parts: API Horizon, Stellar Core and Stellar Network, which together create the Stellar network commonly as we perceive it.
Lumens are a fundamental part of the network and a lumen (XLM) is a unit of digital currency, as is the case of Bitcoin. This name was given in 2015 when the network was improved and it differed completely from the Ripple Code when the Stellar tokens were renamed Lumens.
The Lumens have an antispam role in the blockchain of Stellar and avoid accounts with empty balances to avoid saturation of the network. All accounts in the network must have a minimum of 0.5 lumens for its operation.
The Stellar platform integrates lumens, other cryptocurrencies, cryptoassets and fiduciary currencies into a single network in which they can be easily exchanged and with few fees.
Here are some of the important things about Stellar:
1.- Transactions many times faster than Bitcoin.
2.- Very low commissions.
3.- One of its main partners is the giant IBM.
4.- Extensible protocol, proof of this is the ability to add support to payments using LN.
The most unfavorable point for Stellar is its similarity with Ripple although more decentralized than the XRP token. In addition, it represents a high return to its investors.
Use Cases of Stellar Lumen.
Stellar Lumen has many cases of use at present, thanks to its alliance with giants like IBM, Stellar has developed vertiginously in the last year, with new use cases worldwide. Among them is a central banking solution for Deloitte, one of the four largest accounting firms in the world. Developments are also reported for Tempo, Parkway Projects, bext360 among many others.
The new use cases are promised to arrive sooner rather than later, and this point is what differentiated Stellar from other blockchain projects. Its true added value is not in its lumens, but in the Stellar network and its usefulness.
The use cases, as the project grows, will also underlie the token price, so in the long term it is an excellent investment.
Technical Analysis of Stellar Lumen (XLM)
At the time of writing, XLM presents a spot price of $ 0.115 per unit with a positive change of + 0.95% in the last 24 hours. Its market capitalization is just over $ 2.2 trillion dollars, which makes it the custodian of the ninth position according to CoinMarket cap.
In the short term, the lumens (XLM) present an ascending trajectory, with an identical double pattern currently closing, indicated by the triangles ABCD.
In this 1H chart we can see that a possible bullish cross is about to occur for April 15 according to the short vs. long EMA forecast, driving the cryptocurrency to levels of $ 0.124 in the short term (+ 7.8%).
The above is confirmed by Aroon Uptrend (green line) which remains at the top of the graph and by the crossing of highs and lows in the short term.
We can also confirm this in the 1D chart for Stellar (XLM), which shows a high capital inflow by investors and as the CMF indicator is projected this will continue in the coming days, given the good feeling they have about the cryptocurrency.
Analyzing this chart in more depth, we can observe a double Elliot Wave Triple Correction pattern being fulfilled to project to R1 level ($ 0.2) by mid June 2019.
Its support remains firm at S1 levels ($ 0.074) and an upward channel is easily projected in the last month by Stellar, synonymous with an uptrend.
The RSI indicator, although not yet at average levels of 70 that XLM has accustomed us, has not fallen to sales levels either. Therefore, some important change is expected to arise.
To confirm the above and be able to correlate possible matching dates of levels of R1, we can see that XLM has drawn in the last bullish crosses a line of time perfectly predictable by averages.
We can verify the said averages using the Stochastic indicator which is totally coincident with the price rises and its high values registered in those moments in the last year.
In this way, the proposed mid-year scenario for Stellar to R1 levels, is confirmed by Stochastic and Elliot Wave, in addition to the expected bullish EMA crosses, as observed in the last two graphs above.
Therefore, Stellar presents a possibility of entry to obtain medium-long term profit levels around very high double digits.