- Key Highlights:
- The current adoption rate of Stellar;
- Upcoming projects and launches on the Stellar network;
- Keep an eye on the Ripple vs. SEC lawsuit,
- On-chain data is looking pretty good for Stellar.
Introduction
Once upon a time in the not-so-distant past, Stellar or Stellar Lumens (XLM) was the darling of the payments world, with investors and businesses alike drooling over its promise of a fast, cheap, and secure cross-border payment network. Stellar was lining up high-profile payment partners left, right, and center, including large industry players such as IBM and Moneygram International.
But as we fast forward to the present, the reality has shifted significantly. Stellar has lost much of its luster since its heydays, and it’s no longer the star it used to be. The crypto world is a fickle one, and things can change in the blink of an eye.
As of this writing, the price chart of XLM shows a cryptocurrency getting pummeled, with the cryptocurrency maintaining a downward trend since it peaked at $0.79 in May 2021. As of early March, XLM traded at $0.082, a 90% drop from its ATH.
Source: TradingView | XLM/USD Weekly Chart
The question now is: can Stellar return to its glory days?
In this blog post, we’ll take a closer look at Stellar and some of its growth and increasing adoption recorded in recent times. We’ll explore if the recently recorded growth and adoptions can pull Stellar out of the doldrums and return it to its glory days.
A Brief Intro to Stellar
Before we go into the topic at hand, let’s talk a bit about Stellar Lumens and its history. Stellar Lumens was created in 2014 by Jed McCaleb, who also co-founded Ripple (XRP) before leaving the company due to differences in vision. McCaleb wanted to create a decentralized payment system that was fast, cheap, and accessible to everyone, especially those who were underserved by traditional financial systems.
Stellar Lumens was built to facilitate cross-border payments and make them more efficient and affordable. The Stellar payment network is open to the public and geared towards small individuals, while Ripple is more focused on banks and financial institutions. Stellar Lumens has gained a lot of popularity in recent years due to its fast and cheap transaction times, making it a strong contender in the world of cryptocurrencies.
However, as we’ve mentioned, the crypto market is a volatile one, and Stellar Lumens, like many other cryptocurrencies, has taken its fair share of beatings. The bear market of 2021 hit Stellar Lumens hard, and the protocol has been struggling to regain its former glory since then.
But could that change with the introduction of a new product for the network called Soroban?
Will On-Chain Development Help Stellar Out of the Abyss?
Soroban is Stellar Lumens’ very own smart contract platform, designed to plug into the Decentralized Finance (DeFi) and smart contract-enabled world. Stellar Lumens was primarily created as a payment token, but Soroban is set to reposition it as a strong competitor to its peers in the world of blockchain. The most famous and versatile blockchain protocols today are those known for their smart contract capabilities, such as Ethereum (ETH) and Binance Smart Chain (BSC).
Source: Soroban
Soroban will enable developers to create DApps on the Stellar network, which will significantly enhance the ecosystem’s capabilities. Developers can use Soroban to create decentralized exchanges (DEXs), non-fungible token (NFT) protocols, and even oracles, provided it can contribute to the overall growth and development of the Stellar ecosystem. This opens up a world of possibilities for developers and will attract more users to the Stellar ecosystem, which translates to more growth for the network.
Meanwhile, Stellar Lumens recently announced the launch of the “Stellar Asset Sandbox” on February 1, which allows users to issue, mint, or burn new assets through the Stellar testnet without coding knowledge. This is a great feature for those who are new to Stellar and want to explore the platform’s capabilities without any coding expertise.
Source: Twitter (Stellar)
Ripple’s Predicament Will Favor Stellar
The adoption rate of stellar continues.
Now, let’s talk about the ongoing XRP court case and how it might affect Stellar Lumens. While Stellar Lumens has always been a strong contender in the world of cryptocurrency, it has faced stiff competition from XRP, which has a payment network known as Ripple.
The operational models between Stellar and Ripple are similar, considering both platforms function as cross-border payment providers. However, as I’ve mentioned, where they differ is that Ripple focuses on banks and financial institutions, while Stellar Lumens is open to the public and geared towards small individuals.
However, there might be some good news for Stellar Lumens. XRP is currently locked up in a contentious court case with the SEC, and a final resolution might be reached before the end of the year. If XRP loses its court case, it could be a significant boost for Stellar Lumens, as investors might see it as a more reliable and stable investment option. On the other hand, if XRP wins its court case, Stellar Lumens could enjoy a short-term price rally as investors would rest assured that the SEC is unlikely to come after the project as it did with Ripple.
As you can imagine, the outcome of the Ripple vs. SEC case is critical to the growth projection and adoption rate of Stellar in the near term, at least in 2023.
On-Chain Outlook for Stellar
On-chain figures for the Stellar network show that the network is recording decent adoption and growth despite the lingering bearish market outlook. Recent data from Stellar Expert’s Explorer shows that there are over 7.2 million accounts on the network, and that number continues to grow daily. This highlights the level of trust users have in the network.
Source: Stellar Expert
Also, the network boasts 64,100 unique assets, 1,498,535,969 payments processed, 2,195,529,888 trades on the DEX, and a whopping 30,688,534,194 XLM in overall DEX volume. That’s a lot of XLM changing hands, and it shows that the platform has a healthy and active user base. Plus, with 26,465,986,296 XLM in circulation and 78,974,406,814 XLM reserved, it’s clear that there is a strong demand for the token.
