All about Stellar XLM


The traditional system has different problems plaguing it, and the problems have contributed to making banking difficult for its customers. Some of the problems plaguing the banking system include exorbitant fees, restrictive access to loans, slow cross-border transfers, etc. If there is one thing bank customers crave, it is easy and seamless banking with near-zero transaction fees, and lightning fast cross-border transfers.

However, the centralized system of banking coupled with the profits they make off customers will make it very difficult for the traditional banking to accept decentralization and this is why many banks, financial institutions, and governments are against the blockchain technology, cryptocurrencies, and cryptocurrency exchanges.

The blockchain technology is a revolutionary innovation that has come to be a portal for the creation of FinTech platforms that serve as effective alternatives to traditional banking. The blockchain technology along with the introduction of Smart Contracts has made financial transactions a whole lot easier, and many people are beginning to embrace the blockchain based system of doing business.


Stellar is a decentralized and open-source hybrid blockchain based platform that was launched in 2014, it was created for fast and reliable transfer of money. With the Stellar platform, users will be able to transfer financial assets, values, and payments from any part of the world after integrating with the network intending to use the platform.

Furthermore, compared to banks, traditional means for money transfer, and payment networks, everyone using the platform will have the same unhindered access and economic participation. Stellar does not just intend to be just another decentralized and non-profit monetary service, but rather aims to be the change agent in the financial industry.


• The annual inflation of the system is fixed at 1%.
• It allows for the functionality of multi-signature wallets and Smart Contracts.
• The token used on the system are not mined, and there are 100,000,000,000 lumens existing from inception.
• Confirmation of transactions takes 5 seconds max.
• The system does not use the Proof of Work (PoW) algorithm, but rather utilizes the Stellar Consensus Protocol (SCP)
• Transactions can be facilitated using any currency.
• It processes thousands of transactions per second.
• API for optimum use.
• Decentralized system that eliminates 3rd parties.

Stellar Transactions

The platform was created to cater to all banking needs; however, it is doing it the decentralized way as opposed to the centralized banking system. There is a simple remittance system that allows users send money across borders for near-zero fees.

Benefits are also provided for micropayments, and this is achieved by increasing efficiency and decreasing cost, hence, customers will be able to get options of incremental payment without downsides. Users will also enjoy transactions in real time, and the transactions have a high level of cryptographical security.

Among other things, the platform features regulatory compliance, auto currency exchange, global acceptability, and payments get transported the way emails are. For the unbanked, Stellar is the perfect option because it gives them the opportunity to get associated with a financial institution, and by cost reduction, new customers will be reached by companies.

The Stellar Network

One of the purposes of Stellar is to make the platform available to everyone from all around the world, and it is achieving this by using the Stellar network which uses decentralized servers spread all over the world, and these decentralized servers are responsible for the power behind the distributed ledger. Every transaction carried out on the network gets recorded on the ledger, and this is a way to provide transparency.

Stellar Lumens (XLM)

The Stellar system is backed by a digital currency called Lumen (XLM), and they are native assets, which invariably mean the cryptocurrency is embedded in the network. There are various reasons why the Lumen was created and including making it difficult for spammers to get on the network and begin the annoying process of filling the network with spam.

Another use of Lumens is to ensure the authenticity of the account holders on the network, as users are required to own a minimum of 20 Lumens. Lumens act as a bridge between multiple currencies and direct markets.

A lot of cryptocurrencies have used the Proof of Work (PoW) system, which has been known to create a decentralized and trustless consensus. However, Stellar Lumens comes with something different, the Stellar Consensus Protocol (SCP) which is used for the creation of the Stellar Ledger.

The Stellar Ledger has similarities with the Bitcoin’s ledger, however, the Stellar Consensus Protocol gets its facilitation from any server that operates the Stellar server, and furthermore, the servers are always in sync, and as such, a consensus is established.

The Lumens can be used for different purposes, as they are able to facilitate solutions to problems users of traditional banking usually experience including: functionality of intermediary currency, micro-transactions, and cross-border transfers/payments.

Assuming you want to swap US Dollars for Euros, you can use the Stellar network to effect the conversion by searching and matching required offers, then the Lumen token will be used in making the swap. This brings a whole new kind of dynamism to the system of conversions, especially when you need to swap a currency that is not common with one that is common, and Lumens makes the transition seamless and fast.

Stellar Lumens Wallets

Lumens digital currencies can be stored in different digital wallets, depending on the choice of the user; there are web wallets, mobile wallets, and desktop wallets that can be downloaded from Stellar’s official website. The Ledger Hardware wallet also supports the Lumens digital currency and is one of the safest means for the long-term storage of cryptocurrencies.

• Cold Wallet

These are offline wallets. To use this type of wallet, here are the steps:

The first thing you need to do is to download the latest version of cold wallet. Please note that it is cross-platform, hence it can work on any mobile device irrespective of the operating system (OS).

The next thing to do is to extract the .zip, and then click and open the file.
After installing and running the software, you will be required to create a new account that will be associated with the software, after which you will create another different account and name it Empty Account, and then pick an address for the wallet.text file that will be opened.

Next, you should create a password, it is imperative that you use a password that cannot be guessed by anybody, and one that you will not forget. The password also has to be really strong enough, that it cannot be hacked. The password will be the security key to decrypt the file, which contains your private key and public key.
Now you are done setting up your cold wallet, just as the instructions directed.

After setting up the wallet, another very important thing to do is to create a backup of the wallet.text file and save on a totally different location that can only be accessed by you. It is a precautionary measure to ensure safekeeping of your cold wallet and the coins in it.

Do not release your private keys to anybody, and do not misplace them, as the private key is the only access to your digital currencies.

• Hot Wallet

Hot wallets are web-based wallets, and in comparison, with the cold wallet, the hot wallet works well for day-to-day cryptocurrency-based transactions. There are quite a number of websites that have different types of web-based wallets with different features, but the primary feature being that Lumens and other cryptocurrencies can be stored in them. If you want a recommendation, then perhaps you can check Because it is web-based, the wallet is not selective about the kind of OS, hence, it is compatible with both IOS and Android devices.

Users using the wallet the first time with Lumens will also get 25 free XLM – remember the minimum amount of XLM required to be a part of the Stellar network is 20 XLM, so with the hot wallet, you get 5 extras. There are different reviews about wallets, however, it is important that before you pick any (if you must use a hot wallet), you should do a well-detailed research about them.

It is however not advisable to save a lot of cryptocurrencies on web-based wallets, as they are highly susceptible to hacks and attacks.

Buying Lumens XLM

Stellar Lumens cannot be bought with fiat currencies, hence the user is required to buy the digital currency using other currencies like Ethereum or Bitcoin, and the purchase can be done on the Coinbase platform using a credit/debit card or via bank transfer, and then swapped for XLM on an exchange platform like Binance.

• Register on the Coinbase Platform:

For people who are new to the crypto community, it is recommended that your first crypto purchase takes place on Coinbase, as it is an exchange that is regulated by the US government; hence it is a good place to buy cryptocurrencies. On Coinbase, users can buy digital currencies like Litecoin, Ethereum, and Bitcoin via bank transfer or credit/debit cards. If you have not signed up already, then click on the “Sign Up”, where you will be redirected to fill a registration form. Once registration is done, then you can begin purchasing either of Ethereum or Bitcoins.

Assuming you want to purchase Ethereum, click the “Buy/Sell” tab somewhere at the top of the screen, then pick “Ethereum”, next you should pick your method of payment, then input the amount you intend to purchase, after which you will confirm the transaction. However, if you intend to purchase Bitcoin instead of Ethereum, it is the same process, just pick select “Bitcoin” after clicking the “Buy/Sell” tab.

• Buy Lumens on Binance:

After buying Ethereum or Bitcoin, next step is to swap them for Lumens, and to do this requires sending the just purchased cryptocurrencies to Binance (If you are new to Binance, then you are required to sign up, after which you can exchange the Ethereum or Bitcoin for Lumens)

The Stellar network is easy to use, all you need to do is create an account on the Stellar website, once you are done with that, you can begin transactions, there are guides on the website to direct you and deal with whatever doubts you may have. Using the Stellar network attracts no fees, as it is free to use. The Stellar license makes it possible for developers to modify and distribute it. However, when integrating with another system or app, you will have to use your own resources (technical). Integrating the API is time-consuming, depending on the technical experience of the developer; average integration time can be between 120 hours and 200 hours.

Unlike many other blockchains, this Stellar blockchain is really impressive, as it can process every transaction within an average time of 5 seconds, and confirmation of transactions, within a maximum of 10 seconds, there are hardly any platforms with such processing speeds.

The Stellar platform interface is intuitive and has a modern feel, and grants users direct access to the Stellar blockchain, and it also has analytics and an account management system that is efficient and lets you check your history, assets, open offers, and every other detail about the account. The interface for trading gets real-time updates, and you will be able to see when new offers and trades are sent to the blockchain.

The decentralized exchange is making revolutionary moves to make Stellar the network of the masses. The system is created such that there are no 3rd parties or custodians of the funds, and this invariably translates to the platform being highly secure and safe and removes any form of susceptibility to hacks and attacks. The exchange is one that combines reliability, cost-effectiveness, deep liquidity, high-level security, and high volume in one platform.

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