Stellar (XLM) provides a decentralized international payment network that enables fast transactions at a lower cost. In this article, I will explain how to buy stellar (XLM) popular currency and some related problems of buying stellar (XLM). You can buy stellar (XLM) on many cryptocurrency exchanges. These specialized markets allow you to buy and sell cryptocurrencies, which work like stock trading platforms.
Want more than just to buy XLM? Access dozens of different cryptocurrencies buying guides 2022 here.
What is Stellar (XLM)?
The Stellar Development Foundation was founded in 2014 as the bedrock of the Stellar open-source network. The foundation’s mission was to make the currency more fluid, allowing people to participate in the global economy.
Stellar is a payment protocol based on distributed ledger technology. It allows quick, cross-border transactions between any pair of currencies. In many ways, it is similar to other blockchain-based cryptocurrencies.
Like other cryptocurrencies, Stellar lumens are a form of digital currency that allows money to flow more freely. But in the case of Stellar, the currency itself isn’t the central focus. Instead, lumens were created to add a small barrier to entry to the Stellar network to deter bad actors from slowing it down. The Stellar network itself is really the focal point.
Stellar has experienced many growth spurts, such as when Mercado Bitcoin announced its use of the platform. In less than a year, Stellar housed almost 3 million user accounts. Since that time, Stellar has built a network of partners that includes Flutterwave and MoneyGram.
Furthermore, Stellar contains one critical component that is not found with Ripple — the ability to conduct ICOs on the Stellar network. In other words, new cryptocurrency projects can use the Stellar blockchain to release their own token. So far, most new projects in the cryptocurrency space have launched ICOs using ethereum using ERC20 tokens. But, due to Ethereum’s popularity coupled with current scaling mechanisms, the past year saw massive backlogs of transactions with slow transaction speeds and volatile, hefty fees. Stellar promises faster transactions and lower costs than ethereum, which is why some crypto startups have started to use Stellar as a platform to launch initial coin offerings.
These features, combined with the decentralized and altruistic mission of Stellar, have attracted favorable attention in contrast to the criticism facing Ripple. The two are pursuing very different things, and many feel there is room for both in the big picture of the global financial ecosystem.
Read More: What is Stellar (XLM)?
How Does Stellar (XLM) Work?
Like (almost) all other cryptocurrencies, Stellar bears that beautiful buzzword that has become the hallmark of blockchain technology: decentralization. The network runs on a web of decentralized servers supported by an international consortium of individuals and entities. These servers support the distributed ledger that keeps track of the network’s data and transactions.
In practice, the Stellar protocol functions like a more inclusive, more flexible PayPal. To start using it, you need to upload funds to an anchor on the network. Much like a bank or PayPal, this anchor then holds your money and issues credit to your virtual wallet in its stead.
Stellar has a ledger that it uses to track ownership of all the accounts and crypto tokens on its network. It maintains the ledger and processes transactions with its own unique algorithm, the Stellar Consensus Protocol.
The Stellar ledger stores every account’s balances and operations (what they want to do with their funds). For example, an account could have a balance of 1,000 XLM and 100 U.S. dollar tokens and a pending operation to send 100 XLM to another account.
All balances and operations are broadcast to the entire network every five seconds. Transactions are validated by computers that run the core Stellar software, which are called nodes. For each pending transaction, the nodes verify that the correct amount is transferred.
There are nodes around the world, and anyone can make their computer a node by installing the Stellar software. Their computer will then become part of the consensus process.
With the system it has set up, Stellar is able to process transactions within five seconds. The transaction fee is 0.00001 XLM — a small fraction of a penny at today’s prices. (The fee can rise when network activity is high, but it will still be quite cheap.)
Why Buy Stellar (XLM)?
The cryptocurrency industry is growing at a rapid pace. Just one decade ago, the world was still getting used to the idea of a completely digital currency that ran on a blockchain network. Today, there are almost 9,000 different altcoins in existence. Even though we constantly see new altcoins join the ranks, most of these have not yet truly made their mark.
Ripple was created so that banks could make transfers around the world in a matter of seconds for a very small price. It improved the efficiency of banks and financial systems.
Stellar, on the other hand, was built with the average user in mind and for those in developing countries. The platform provides access to the global economy through simple, quick and low-cost transactions. While the average person can use Ripple and banks can use Stellar, they were each designed for specific users to provide a more efficient experience to their target markets.
Stellar Lumens is a cryptocurrency that has started to gain more attention recently. The Stellar Network was developed with a specific purpose in mind, which also led to the development of a built-in coin.
In this post, we take a closer look at Stellar Lumens and the XLM token and consider whether it might be worth investing in this altcoin.
Stellar is a solid cryptocurrency project. It has a strong team behind it and solves an important real-world problem — the high costs of making international payments. It boasts a number of big partnerships, including MoneyGram, Circle (the company behind USDC), and IBM.
One question to ask of any cryptocurrency is what problem it solves, and whether there’s a market for that solution. Stellar’s ability to provide rapid and low-cost money transfers certainly addresses the very real issue of expensive money transfers. The World Bank estimates the global average cost of a remittance is around 6.5%. That means someone who’s working in the U.S. and sending money home to their family in, say, El Salvador could lose $6.50 for every $100 they transfer. As to whether there’s a market, according to Verified Market Research, the remittance market was around $16 billion in 2020, and could reach $40 billion by 2028.
All cryptocurrency investments are risky, so it’s advisable to only invest money you can afford to lose. This is a relatively new and unregulated market with a lot of uncertainty. It’s also important to do your own research — only you know your risk tolerance, investment priorities, and financial situation, so only you can decide if this is the right investment for you.
How to Buy Stellar (XLM) in 4 Simple Steps
- Step 1: Decide where to buy Stellar (XLM).
- Step 2: Think about how to store your Stellar (XLM).
- Step 3: Make your purchase.
- Step 4: Manage your investment.
How to Buy Stellar (XLM) on a Crypto Exchange
- Step 1. Create a Coinbase account
Download the Coinbase app and start the sign up process. You will need a valid ID and may be asked for proof of address in order to transact, so be sure to have those ready. Verifying your ID may take longer than a few minutes, depending on where you live.
- Step 2. Add a payment method
Tap on the payment method box and connect a payment method. You can use a bank account, debit card or initiate a wire.
- Step 3. Start a trade
Press button then select “Buy” from the list of options.
- Step 4. Select Stellar (XLM) from the list of assets
Search for Stellar (XLM) by typing “Stellar (XLM)” into the search bar. When you see Stellar (XLM) show up in the results, tap it to open up the purchase screen.
- Step 5. Enter the amount you want to buy
Use the number pad to input the amount you want to spend in your local currency. The app will automatically convert that into a Stellar (XLM) amount.
- Step 6. Finalize your purchase
Tap “Preview buy” when ready. You’ll be shown the details of your purchase. Make sure everything looks good and then confirm your purchase. That’s it, you’ve bought Stellar (XLM).
- Step 1: Find a crypto exchange or trading platform that offers Stellar (XLM)
There are a number of exchanges that will let you trade your funds for Stellar (XLM). One of them is the eToro trading platform.
- Step 2: Sign up
If you’d like to buy Stellar (XLM) through eToro, all you need to do is sign up, verify your account and make a deposit. From there, you’ll be able to buy and sell Stellar (XLM) easily.
- Step 3: Buy Stellar (XLM)
Stellar (XLM) can be purchased fractionally, so you don’t need to buy a full Stellar (XLM) to own some. For example, if Stellar (XLM)’s price is $10,000, you can purchase 0.1 Stellar (XLM) for $1,000.
- Step 1. Log in to your account or sign up to Bitfinex.
- Step 2. Go to Deposit, choose Payment Cards.
- Step 3. Select the payment processors.
- Step 4. Choose the crypto and enter the amount.
- Step 5. Select the destination wallet and proceed payment
- Step 1: Create your Binance Account
Sign up with your email address or mobile phone number, and choose a strong password. Or, download the Binance crypto trading app from the App Store or Google Play store and open an account there.
- Step 2: Start Buying Stellar (XLM)
There are two main ways to buy Stellar (XLM) on Binance using cash: you can link your debit/credit card or bank account, or buy crypto directly from other users on Binance P2P.
Linking your debit card, credit card, or bank account (available in many regions) is one of the easiest ways to buy Stellar (XLM). Through this method, you can buy Stellar (XLM) for a minimum. (This amount varies depending on the currency you use.)
Buy Stellar (XLM) directly from other Binance users with your local fiat currency via Binance P2P. Browse a variety of Stellar (XLM) listings to shop the best offers on Stellar (XLM) from other users. With thousands of merchants and hundreds of payment methods available, Binance P2P caters to many regions in the world right now.
- Step 1. Sign Up for KuCoin Account
- Step 2. Secure Your KuCoin Account
- Step 3. Verify Your Identity
- Step 4. Connect Your Account to Funds Fund Your Account
- Step 5. Start Trading on KuCoin
How to Buy Stellar (XLM) With PayPal
- Step 1. Login to Paypal and Select Cryptocurrency
In Paypal website, you should see the option for cryptocurrency in the top right of the dashboard, next to ‘Send’ and ‘Request’.
- Step 2. Select ‘Stellar (XLM)’
Or choose any of the other coins listed.
- Step 3. Select ‘Buy’
- Step 4. Choose How Much You Want to Buy
Enter an amount of dollars you want to spend on Stellar (XLM) or choose a pre-set amount below.
- Step 5. Select Payment Method
You likely already have you bank account linked to you Paypal account, but you can also hook up another method if you don’t want to use your bank account.
- Step 6. Hit the ‘Buy’ button
After finalizing your purchase, you will be taken to a confirmation screen and you should see your coins reflected in your Paypal account dashboard.
How to Buy Stellar (XLM) With a Credit Card
Not all platforms will allow you to use a credit card to make your cryptocurrency purchases. If you do choose a platform allowing such transactions, keep in mind that there may be extra fees associated with the purchase. Many credit card companies process cryptocurrency purchases via credit card as cash advances, which can incur high interest rates, among other fees.
Some credit card companies allowing cardholders to make crypto purchases treat the purchases as a cash advance (cash advances usually involve a cardholder using a credit card to withdraw money from an ATM). This has several critical disadvantages.
- Cash Advance Fees: Some cards treat a cryptocurrency purchase as a cash advance. This means each crypto purchase is subject to a cash advance fee. A typical fee of either $10 or 5% (whichever is greater) would be charged. These fees are in addition to fees charged by the vendor or exchange.
- Cash Advance Interest Rates: Most cards have a higher Annual Percentage Rate (APR) for cash advances—often over 25%. This is a variable interest that changes with the market. Interest will start to accrue on the day the purchase is made and will continue to accrue until the credit is paid off. By comparison, cardholders have up to 25 days to pay off a regular credit card charge before accruing any interest.
- No Credit Toward Rewards orBonuses: Credit used to purchase crypto (and thus make a cash advance) typically doesn’t qualify for any purchase rewards nor toward spending that would normally apply to a welcome bonus.
- Lower Credit Limits: Cash advances often have a lower credit limit than the cardholder’s overall credit limit that applies to the card itself. Cardholders hoping to make big crypto buys may find themselves limited by the cash advance terms and limitations.
Read More: How to Sell Stellar (XLM)?
Buying Stellar (XLM) FAQs
What is a Stellar (XLM) Wallet?
Stellar (XLM) is a simple, secure, easy and intuitive wallet for your Stellar XLM coins. Keeps track of the balance in multiple accounts, and allows receiving and sending transactions, even to other cryptocurrency.
A mobile Stellar Wallet for your Android device with multiple functions. It is an easy to use and secure crypto-service which keeps your funds safe and makes your life more convenient. Store and manage your XLM in this mobile cryptocurrency wallet for XLM beginners and advanced crypto enthusiasts.
Can You Sell Stellar (XLM)?
You can buy Stellar (XLM) on a cryptocurrency exchange like FTX. These specialised marketplaces that allow you to buy and sell cryptocurrencies, and work similar to stock trading platforms. Launched in 2014, Stellar Lumens is a cryptocurrency that aims to offer fast and affordable cross-border transactions.
The whole process can take as little as 15 minutes and all you’ll need is a smartphone or computer, an internet connection, photo identification and a means of payment.
- Compare crypto exchanges
The easiest way to buy Stellar is from a cryptocurrency exchange. Comparing in the table below lets you find one with the features you want such as low fees, ease of use or 24-hour customer support.
- Create an account
To create an account on an exchange, you will need to verify your email address and identity. Have some photo ID and your phone ready.
- Make a deposit
Once verified, you can deposit RM using the payment method that best suits you – credit card, wire transfer, silvergate exchange network (sen) and signature signet payments are widely accepted.
- Buy Stellar
You can now exchange your funds for Stellar. On easier-to-use exchanges, this is as simple as entering the amount you want to purchase and clicking buy. If you like, you can now withdraw your Stellar to your personal wallet.
Read More: How to Sell Stellar (XLM)?
What is a Stellar (XLM) Address?
The Stellar protocol allows you to map your public key (e.g. GCCVPYFOHY7ZB7557…) to an email-like address such as yourname*domain.com. This is called a ‘Stellar address’ (a la ’email address’).
‘Stellar addresses provide an easy way for users to share payment details by using a syntax that interoperates across different domains and providers.’ – Stellar Developer Docs
Stellar addresses have two parts: a username and a domain. They are split by * instead of @.
For example – yoda*lumenauts.com:
- + yoda is the username,
- + lumenauts.com is the domain.
The username is limited to printable UTF-8 with whitespace and the following characters excluded: <*,>’ – Stellar Developer Docs
How to Accept Stellar (XLM) Payments?
The developers of Stellar follow the original goal of cryptocurrencies, so the Stellar network is completely decentralized and has an open source code. For this reason, XLM is widely recognized as one of the best means of payment. Stellar is able to process more than a 1000 TPS (transactions per second), and the confirmation time is on average from 2 to 5 seconds. Moreover, the Stellar network is distinguished by its high level of security.
- First, you need to sign up for a NOWPayments account. The process shouldn’t take more than a minute!
- Go to Store settings. Add your Stellar wallet and create a new API key.
- Choose the tool to add to your checkout.
- The integration will be active on your website, and you’re ready to accept payments in Stellar!