- Stellar Lumens (XLM) has recently risen to $0.105, reflecting a 36% increase from its July low, with analysts predicting a potential price surge to $0.73.
- Despite these positive signals and strategic partnerships, Stellar faces challenges with its Soroban blockchain, which has yet to gain significant traction.
A Surging Underdog
Stellar Lumens (XLM) has recently shown a promising upswing, trading at $0.105 on Wednesday. This marks a 6% rise from its lowest point this month and a notable 36% increase from its July low. For investors eyeing undervalued assets, Stellar’s recent performance is turning heads.
Roots and Partnerships
Stellar’s origins are intertwined with those of XRP. Founded by Jed McCaleb, who previously served as Ripple’s Chief Technology Officer, Stellar shares similar goals with XRP but has carved out its niche. The network is currently known for its strategic partnership with Circle, the issuer of USD Coin (USDC). According to Circle’s data, Stellar holds a substantial USDC supply of $228 million as of July 31.
In addition to this, Stellar’s collaboration with MoneyGram allows USDC recipients to access cash at thousands of MoneyGram locations worldwide. This partnership not only expands Stellar’s reach but also enhances its utility.
Institutional Investments
Stellar also plays a significant role in institutional finance. It powers Franklin Templeton’s OnChain U.S. Government Money Market Fund, which boasts over $402 million in assets. This fund, known as FOBXX, is similar to BlackRock’s BUIDL, offering tokenized investment opportunities designed for regular income.
Analyst Insights
Amid market fluctuations, analysts are optimistic about Stellar’s future. Jonathan Morgan, lead crypto analyst at Stocktwits, has highlighted Stellar as one of the most undervalued cryptocurrencies. Similarly, Cryptosahintas, a prominent analyst with over 155,000 followers, predicts that XLM could surge to $0.73—a remarkable 600% increase from its current price. This optimism is bolstered by technical analysis, which shows that Stellar has formed a falling wedge chart pattern between March and July. The falling wedge is considered a bullish signal, suggesting that a breakout could be on the horizon.
Despite these positive signals, Stellar faces fundamental challenges. The Soroban blockchain platform, integral to Stellar’s ecosystem, has struggled to gain traction. It has attracted only six Decentralized Finance (DeFi) developers and holds just $11.70 million in total value locked (TVL). This lack of developer interest could impact Stellar’s long-term growth and adoption.
Stellar Lumens presents an intriguing case of an undervalued asset with significant potential for growth. While the recent price uptrend and bullish predictions are promising, investors should also consider the ongoing challenges. As always, careful evaluation and due diligence are essential for navigating the volatile world of cryptocurrency investments.
