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Stellar Lumens (XLM) price prediction 2021
What’s the forecast for the price of Stellar Lumens in the weeks and months ahead?
With ambitious plans and some big partnerships to its name, Stellar is a cryptocurrency project being watched with interest by many traders. However, Stellar faces stiff competition from crypto giant Ripple and will also need to overcome some other key obstacles if it’s to achieve success.
So before deciding whether you should buy XLM, let’s take a look at the factors that could drive the growth or decline of this digital currency.
|Coin name||Stellar Lumens|
|Launch date||July 31, 2014|
Stellar (XLM) price prediction 2021
Stellar (XLM) is currently trading at around US $0.27, which means there is room for improvement, according to Finder’s panel of crypto experts, who gave an average predicted price of US $4.69 for the year’s end.
However, this average is heavily impacted by one outlier. Co-founder of Trade The Chain Ryan Gorman thinks the value of Stellar could hit US $60 at the end, saying, “A rising tide lifts all ships, and Bitcoin and other altcoins rising in value over time will help XLM appreciate.”
While the heady average of US $4.69 might be a bit of a stretch, the median prediction from the panel for the coin is somewhat encouraging, with an expectation the coin will be worth US $0.43 by December 2021.
It’s a similar story with the averages for both December 2025 and December 2030, with lofty predictions from Gorman of US $150 for 2025 and US $200 for 2030, resulting in a panel average of US $12.14 and US $17.66, respectively. The median predictions for the panel are far more down to earth, with the median panel prediction being US $1.70 for December 2025 and US $4.50 for December 2030.
Dr. Iwa Salami, a senior lecturer in FinTech Regulation at the University of East London, and Coinmama CEO Sagi Bakshi both see the gaining value going forward and being worth US $5 come 2030. For Bakshi, "competition over smart contract platforms" will help to bolster its price.
However, Dr. Salami attributes the price increase to countries exploring Central Bank Digital Currency (CBDCs). He adds, "As an increasing number of countries around the world explore CBDCs, concrete examples of successful implementation of these projects by blockchain technology firms is likely to increase the value of their native cryptocurrencies. As such, this may result in an increase in the price of XLM."
Both Decred's international ops lead Jonathan Zeppettini and senior lecturer at the University of Canberra John Hawkins are at the other end of the spectrum. Zeppettini sees the coin's value ending the year at US $0.25 and staying that way going forward, adding it's "not clear this will fuel demand for the underlying asset."
Hawkins thinks the coin will close 2021 at US $0.20 and fall in value until it's worth nothing by 2030. Unlike Bakshi, Hawkins doesn't believe countries exploring the use of CBDCs will save the coin, adding, "The news story pushes Stellar above some of the other coins ranked around 20th. But most CBDCs look like they will not involve an existing cryptocurrency."
Will Stellar price be impacted by the announcement from Ukraine's Ministry of Digital Transformation?
Earlier this year, Ukraine's Ministry of Digital Transformation announced that they'd be working with the Stellar Development Foundation to develop a digital currency for the Central Bank. Around a fifth of the panel, or 18%, don't think this arrangement will impact Stellar prices.
Around two-fifths, or 38%, think that it'll have a slightly positive impact, 35% say a moderately positive impact and 9% say a strongly positive impact.
Meet our panel
|Sagi Bakshi, CEO, Coinmama||Kate Baucherel, Digital Strategist, Galia Digital||Sarah Bergstrand, COO, BitBull Capital|
|Konstantin Boyko-Romanovsky, CEO & Founder, Allnodes||Jeremy Cheah, Associate Professor of Cryptofinance and Digital Investment, Nottingham Trent University||Justin Chuh, Senior Trader, Wave Financial|
|Paul J. Ennis, Lecturer/Assistant Professor, University College Dublin||Pedro Febrero, Head of Blockchain, RealFevr||Josh Fraser, Founder, Origin Protocol|
|Martin Fröhler, CEO, Morpher||Martin Gaspar, Research Analyst, CrossTower||Ryan Gorman, Co-founder, Trade The Chain|
|James Harris, Director, CryptoCompare||Justin Hartzman, CEO, CoinSmart||John Hawkins, Senior lecturer, University of Canberra|
|Julian Hosp, CEO, Cake DeFi||John Iadeluca, CEO, Banz Capital||Sukhi Jutla, COO, MarketOrders|
|David Klinger, Founder, Coteries Corporation||Paul Levy, Senior Lecturer, Brighton Business School||Vetle Lunde, Analyst, Arcane Crypto|
|Nicholas Mancini, Research Analyst, Trade The Chain||Desmond Marshall, MD, Rouge International & Rouge Ventures||Alex Mashinsky, CEO, Celsius Network|
|Bobby Ong, Co-founder, CoinGecko||Daniel Polotsky, Founder/Chief Advisor, CoinFlip||Forrest Przybysz, Senior Cryptocurrency Investment Analyst, Token Metrics|
|Joseph Raczynski, Technologist & Futurist, Thomson Reuters||Dr Iwa Salami, Senior Lecturer in FinTech Regulation, University of East London||Fred Schebesta, co-founder, Finder|
|Xavier Segura, General Partner, Morgan Creek Digital||Avinash Shekhar, Co-CEO, ZebPay||Matthew Shillito, Lecturer in Law, University of Liverpool|
|Ajay Shrestha, PhD Candidate, University of Saskatchewan||Lee Smales, Associate Professor of Finance, University of Western Australia||Elvira Sojli, Associate Professor, University of New South Wales|
|Aleks Svetski, CEO, Amber||Simon Trimborn, Assistant Professor, City University of Hong Kong||Jean-Philippe Vergne, Associate Professor, UCL School of Management|
|Sathvik Vishwanath, CEO, Unocoin Technologies Private Limited||Imran Yusof, FX/Crypto Market Strategist, Quantum Economics||Jonathan Zeppettini, International Operations Lead, Decred|
Where to buy Stellar
What's coming up in Stellar's roadmap?
The future development of a blockchain is just as important as having a strong foundation. Projects that don't innovate often get left behind. This is especially true for Stellar, which has to compete against powerful competition from Ripple. The outcomes of development could heavily influence the future price of XLM.
Like some of the top crypto projects, Stellar updates users and investors on the future roadmap regularly. This is headed by the Stellar Development Foundation (SDF). Within the 2021 roadmap, there are three main areas of core focus. These include improving the usability of the Stellar platform, introducing more people and allowing the platform to become the blockchain people trust, and nurture existing sustainable use cases for cross-border payments alongside developing new ones.
Robustness and usability
With regards to tangible goals, Stellar is aiming to see a 5X increase in the number of transactions taking place on the blockchain. However, this means increased demand. To accommodate increased demand, a prototype layer-2 solution is being explored and a large focus is being placed on attracting and maintaining high-quality validators.
As numbers grow, developers are also aware that small technical errors can lead to disastrous results, therefore, the blockchain intends to increase both the safety and resilience of the network.
To become more robust, Stellar has identified the need to increase the amount of liquidity that is exchanged across the network. In answer to this, the team are looking to develop decentralised exchanges, including automated market makers, and over the counter (OTC) liquidity solutions. A clever move but a tough move. The team will have to compete fiercely to gain market share from an already saturated liquidity market.
The blockchain people know and trust
To increase the visibility of Stellar, the SDF has identified five key goals that the team can focus on over the coming months.
- Marketing Stellar. In conjunction with marketing the internal ecosystem of Stellar, the SDF also wants to assist with the marketing of the top users of the platform. Two case studies will be launched throughout 2021. Stellar's Meridian conference is also scheduled to take place in November which should help connect the platform with global finance participants.
- Advocate legislation. The project will work towards ensuring that global financial institutions can reliably and lawfully use blockchain technology. Advocating legislation will mean Stellar becomes a go-to option.
- Stellar Enterprise Fund. Created in 2019 as a fund to catalyse growth, the fund aims to invest in one new project each quarter of 2021. This should help grow Stellar's ecosystem.
- Technology consultants. Building relationships with prominent technology consultants can help the SDF extend its reach into companies and governments worldwide.
- Supporting events. The SDF aims to host four events each quarter to encourage network building within the industry. The larger the network, the more visibility for Stellar.
Develop and maintain sustainable use cases for Stellar
To continue forward in 2021 Stellar wants to build on the use cases that it already has in play. One of these use cases is called the Vibrant app. This is built on the Stellar blockchain. It plans to increase the number of transactions on the platform by 5X.
Alongside increasing the use of Vibrant, the project wants to add 4 new payment corridors throughout 2021. The team wants to acquire example use cases of individual and business cross-border payments, remittances, global access to financial services, and investing in cryptocurrencies and equities. Breaking into some of these sectors may prove difficult, but pivotal if Stellar wants to become the open network for money.
Stellar's performance will also be influenced (either positively or negatively) by the performance of its competitors. The following cryptocurrency projects are competing with Stellar:
- Ripple (XRP). Stellar was actually created as a fork of Ripple in 2014. While the two currencies no longer share any common code, they both aim to provide instant, low-fee cross-border transactions. However, Ripple and Stellar seem to be focusing on different areas so far. While Stellar is focused on bringing financial services to people living in poverty, Ripple has concentrated on targeting major banks and other large financial institutions. For more information on the similarities and differences between Ripple and Stellar, check out our head-to-head comparison.
- OmiseGo (OMG). OmiseGo is an Ethereum-based platform designed to offer real-time, peer-to-peer exchange and payment services. It was also labeled "an ambitious and clever proposal" in the Stripe blog post that also mentioned the possibility of incorporating XLM in the future.
- Nano (NANO). Previously known as RaiBlocks, Nano is a digital currency designed to offer fast and free transactions, as well as to be infinitely scalable.
- Bitcoin Cash (BCH). Formed in 2017 after a bitcoin hard fork, BCH is designed to offer faster and more affordable transactions than the world's best-known cryptocurrency.
- Litecoin (LTC). Designed to offer faster and cheaper transactions than bitcoin, Litecoin is firmly established in the list of the top 10 cryptocurrencies by market capitalization.
Beyond 2021: What does the future hold for Stellar?
Looking to the future, it's impossible to say with any certainty what the future holds for Stellar. Just like any other cryptocurrency, it is both complicated and at risk of volatility, while it also faces its own unique mix of challenges and opportunities in the times ahead.
Given the Stellar Foundation's focus on capturing market share, marketing new partnerships and generally increasing the user base in 2021, Stellar appears to have a clear outlook for the future. If it continues to solidify global partners and market themselves as a trustworthy project, the blockchain may yet move from the shadow of Ripple (XRP).
The blockchain has recently secured a partnership with Ukraine to provide the infrastructure for its own Central Bank Digital Currency (CBDC), which could be the kind of catalytic move required. If successful, it may mean the project becomes the go-to infrastructure provider for governments globally. The blockchain has also joined forces with IBM's Blockchain World Wire, which could open a diverse network of other strong collaborators.
The blockchain remains a popular global payments platform with some distinguishing features that set it apart from the crowd. It's speed of transactions, security and reliable smart contract infrastructure means Stellar is a suitable contender for many companies. It is the retail uptake and recognition that dwindles, but that will likely come with increased corporate partnerships.
Ultimately, the number of users on Stellar will determine the value of Stellar Lumens (XLM). In January 2008, approximately 250,000 registered accounts existed. In 2020 that figure had grown 15 times to 4 million. With a focus on increased awareness, that trend looks set to continue.
Where Stellar goes in the next couple of years will be fascinating to watch. While the Stellar network has plenty of potential, its main competitor (Ripple) is a major player with strong financial backing. It's worth staying abreast of developments from both projects, as well as news from the wider cryptocurrency world, to see how each is positioned to tackle future challenges.
And before buying any XLM, make sure you research all the factors that could affect the value of Lumens to decide whether they will be a worthwhile purchase.
At the time of writing, the author has holdings in IOTA and XLM.
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