Stellar Lumens are in the news today as they have shot up by a significant margin. As of this writing, the cryptocurrency has shot by over 18% and has reached $0.29. The basic thing to understand here is that Stellar is the protocol while Lumens are currencies. Let us take a look at understanding what the system is and why are people showing faith in XLM tokens –
What is Stellar?
Stellar is a payments infrastructure which allows users to send money in any currency and the receiver gets it in the currency of his preference. For instance, you can send 100 USD and it will automatically get converted to the currency of the receiver’s choice. It will automatically convert and send 100 USD as 83.30 EUR. Stellar can also convert dollars to Bitcoin and send them.
Transactions that are made using the Stellar network carry a very small fee compared to other means of transferring money. Stellar transactions require a fee of 0.00001 Stellar Lumens associated with it.
What are Stellar Lumens?
Stellar Lumens are the token currencies which will power the Stellar network. Technically speaking, they are the ‘native assets’ of Stellar. Stellar had started off in 2014 with 100 Billion Stellar Lumens in existence.
Stellar Lumens are available on most major exchanges and trading platforms. Exchanges such as Bittrex, Binance, Poloniex, Bitstamp among many others allow users to trade Stellar Lumens, which are represented by XLM. Each Stellar user has to necessarily have 20 lumens in their account – which will ensure authenticity and will act as an anti-spam measure.
Lumens are also of use as sometimes there might be a need to convert the currency into Lumens, have them sent across to the receiver, who would be able to convert these Lumens for the currency of his choice. The price of these tokens have suddenly shot up – and it would be interesting to see what the future holds for Stellar.