The Stellar Development Foundation founded Stellar cryptocurrency, a digital currency that has an astounding reputation around it. The currency that we are talking about is known as Lumen, and it is traded as XLM. If you are in the cryptocurrency hub of the world, aka the UAE, then you must want to know if XLM is an actually good investment. With so many options in the market we understand the choice is hard to make. So, this blog is dedicated to helping you understand if XLM is a good investment for investors present in the UAE.
The Stellar network is a blockchain-based distributed ledger network that connects banks and payment systems while facilitating individuals to have low cost, cross-asset transfer of value, including payments. These distributors use Lumen as the source of their function. Stellar facilitates the transfer of digital currency to fiat money both domestically and internationally. It is decentralized in nature. Stellar has been amongst the best performing altcoins for the last five years and holds a market cap of over $5 billion.
The Stellar database is decentralized and open-source, making it a reliable blockchain platform. In 2015 Stellar formulated its own consensus protocol known as the “Federated Byzantine Agreement.” This consensus mechanism allows for a top-notch transaction throughput due to XRM not having the need for “minting” currency. The consensus mechanism provides for the transaction confirmation time to be just 3-5 seconds. Stellar Blockchain supports thousands of transactions per second. It is capable of enabling multi-signatures and smart contracts as well. Also, the annual inflation for Stellar is fixed at 1% currently.
Stellar was founded by Jed McCaleb, who is also the founder of Ripple. The platform was formulated in the year 2014, with Lumen Token (XLM) being its native token. The Stellar XLM token serves to be a protocol for payment of transaction fees and serves as an intermediary bridge currency for cross-border payments. You can also use XLM to create digital assets within the Stellar network. XLM can also be used as an intermediary currency between the digital asset created on stellar and any other digital asset.
The primary use case form of XLM is as a currency. Stellar charges meager transaction fees such that a person can conduct thousands of transactions for less than a penny. The low-cost of transactions is aimed to help Stellar be a major player in the remittances and cross-border payment system, similar to Ripple. However, unlike Ripple, Stellar does not optimize banks but instead focuses on facilitating transactions for the unbanked and underserved by easing currency conversion and cross-border payments. Moreover, the scripting language of the Stellar network allows for simple hostings like ICOs and decentralized exchanges like StellarX.
Stellar is an exceptional blockchain platform that provides users with low fees and high-speed cryptocurrency transactions. Its main focus is to bring corporate sponsorships and open finance to unbanked individuals. The platform uses minimal transaction fees and is capable of performing thousands of transactions.
Moreover, Stellar is capable of formulating smart contracts and ICOs, although these use cases haven’t materialized yet in a meaningful form. Before investing in Stellar in the UAE, you should also know that Stellar holds an above-average amount of exchange listing and liquidity. Also, stellar has a strong relationship with organizations like IBM, making it an ideal investment for investors in the UAE. Do keep an eye on XLM price chart and analyze for yourself.
The primary focus of Stellar is on economies that are developmental in nature and the areas of remittance and bank loans for individuals who do not have banking services. However, that does not limit Stellar’s reputation since it does not charge individuals or institutions for using its network. It is fast, reliable and safe, making it an ideal investment for UAE based investors.
Also, Stellar has a distributed exchange mode. This allows users to transfer currencies across borders while the credit is in a different currency. The system automatically does the forex conversion, adding to Stellar’s ease of use. Also, the receiver can withdraw the balance through a partner institute like a bank. Stellar aims to significantly reduce transaction costs and time lags while completely modifying the scapes of cross-border transfer and payment systems that connect financial entities.
Although Stellar functions exactly like Bitcoin, its distinguishing feature is the consensus protocol. The current Stellarsystem is based on the 2014 fork that resulted in the formation of Stellar Consensus Protocol (SCP), which has led Stellar to be open source in nature. Thereby the future of Stellar is bright for users worldwide.