See how the Stellar network works and what you can use Lumens for.
Stellar lets anyone send, receive or trade any kind of currency, whether fiat or crypto, with anyone else in the world almost immediately and at practically no cost.
Lumens (XLM) is the name of the cryptocurrency token, while Stellar is the name of the network as a whole, and it’s a cryptocurrency with a difference.
Find out where to buy, how it all works and what you can use Lumens for.
How to buy Stellar Lumens (XLM)
If you live in the United States, you won’t find a cryptocurrency exchange offering Stellar Lumens for direct purchase.
Instead, the easiest way to buy Stellar is through a two-step process that requires an exchange with another cryptocurrency.
1. Buy some bitcoin or Ether.
Buy bitcoin (BTC) or Ether (ETH) through a cryptocurrency exchange. One of the leaders, Coinbase makes it easy for aspiring crypto chasers to purchase coins.
2. Exchange your bitcoin or Ether for Stellar.
After your bitcoin or Ether hits your digital wallet, transfer them to an exchange offering Stellar. Among your options is Binance, which charges some of the lowest fees available in the US.
Exchanges where you can buy, sell or trade Stellar
Exchanges where you can buy or sell crypto with USD
Stellar price history graph
Wallets that support Lumens
The primary Stellar wallet is Centaurus, and it is available for Android and iOS. It was specifically designed for Stellar and integrates well with it.
The following wallets also support Lumens:
- Ledger Nano S
- Stellar Desktop Client
- Stargazer
- Stellar Portal
- Stronghold
- Blackwallet
- SAZA
- Papaya
- StellarTerm
- Lobstr
How Stellar works
Stellar is essentially a matchmaker for currencies and facilitates worldwide transfers and exchanges in any fiat currency and cryptocurrency.
It’s much like Ripple. The main differences are more of a focus on simplicity and scalability, as well as on functionality to help move money in remote areas at lower costs.
There are three different ways you can do this.
- Direct exchange. You can make direct currency exchanges. For example, if one person wants to trade USD for AUD and another person wants to trade AUD for USD, it can match them and automatically carry out the exchange for the requested amounts.
- Exchange via XLM. Stellar can use XLM as an intermediary currency where the amounts don’t add up or there isn’t a direct exchange available. It simultaneously looks for buy and sell offers for XLM and the needed currencies. Once it finds a good offer, it then handles the exchange.
- Chain of conversions. If no other options are available, Stellar will try to handle any currency by finding a chain of conversions, such as AUD to BTC to EUR to USD.
The Stellar network is simultaneously doing all of the above at the same time. When you make a transfer, it will aim to provide the best possible rates every time.
If you simply want to send or receive money rather than make an exchange, it can do that by directly connecting individual entities.
The different parts of Stellar
When using the Stellar network, you’ll typically use the ledger and anchors.
- The ledger. This is a central ledger of every account on the network and the currencies it holds. This information is needed to make transfers around the network.
- The anchors. These are trusted entities on the network that hold the currencies being transferred. An anchor might be anything from a bank to a person in a remote village who takes the money online and then hands the recipient the cash.
Why buy XLM?
Lumens is the network token, which you can use to do the following:
- Charge a very minor operation fee. A fee of 0.00001 XLM (almost nothing) is charged to senders for each operation in a transaction. This is purely intended to discourage DDoS attacks, which occur when people flood the network with meaningless transactions.
- Act as an “entry pass” of sorts. You need to hold at least 20 XLM to use the Stellar network.
- Exchange currencies where needed. If necessary, XLM can act as a universal unit of exchange for transferring currencies.
How to sell or trade XLM
- Go to the exchange platform you have your Stellar Lumens in. If you have your XLM in a digital wallet, then you can choose whichever platform from the list above that you’d like to complete your sale with.
- Transfer your XLM to bitcoin or Ether within the platform.
- Still using the platform, follow the steps to sell or trade your bitcoin or Ether.
Security features
One of the notable features is the ability to freeze transfers. For example, you can freeze a transfer if you’ve mistakenly entered the wrong wallet address. This is unlike the irreversible transfers of most other cryptocurrencies.
Once transfers are frozen, the funds are unable to be used by the recipient.
All transactions on the network are public by default, but transactions can be made private and confidential through the use of third-party plugins.
And like other blockchain systems, the Stellar network is a decentralized application run on computers all around the world. This makes it almost entirely failsafe.
If the nonprofit Stellar organization disappeared, its network would keep going.
What to consider when buying Lumens
The initial supply of Lumens was set at around 100 billion XLM, of which around 18 billion are in circulation.
It’s worth considering that Stellar has built inflation into its system by gifting members small amounts of free XLM over time. A fraction of the Lumens collected with each operation goes towards this inflation, along with other XLM released into circulation.
It’s also worth remembering that Stellar is a nonprofit organization aimed at creating a more inclusive world economy for everyone. A high price for Lumens might undermine that goal, prevent people from listing their XLM on the ledger to facilitate exchanges and drive up the average cost of transfers, so there’s a real incentive to keep prices in check.
It’s safe to say XLM prices won’t ever skyrocket in value the way bitcoin has.
However, Stellar has also formed partnerships with companies like IBM and specifically aims to offer low-cost, easy business money transfers. It looks like many organizations are aiming to use Stellar for their money transfer needs, and wider use is likely to cause prices to climb over time.
Buying Lumens also gives users the means to more easily interact with a range of fiat currencies. Forex enthusiasts, frequent travelers or anyone else who can benefit from cheap, quick and easy access to a variety of fiat currencies might get their money’s worth from buying Lumens even if the price doesn’t increase.
If you’re considering what the price of Lumens will do going forward, you might want to compare the features of Stellar and its close counterpart, Ripple. The price increase in Lumens from November 28-30, 2017, saw a corresponding downswing in Ripple at the same time, suggesting that the value of these might be closely tied.
It may also present an investment opportunity for day-trading Ripple or Lumens CFDs, as well as investing by buying.
Find the cheapest way to buy Stellar
Based on your answers, we recommend:
Coinbase and Binance.
The final amount you’ll have will vary depending on the price of the coin and any network transaction fees you incur.
Although this purchase method is recommended, you can click the button below to view other available exchanges.View exchanges
I have traded US $ for Bitcoin on Coinbase.
I have established an account with Binance
How do I transfer Bitcoin to Binance to buy XLM?
Hi Lloyd,
Thanks for getting in touch with finder.
You got an interesting question there, Lloyd.
If you wish to transfer your Bitcoin to Binance, you need the go to Coinbase and select accounts. Next, choose the cryptocurrency that you want to send from your wallets. Enter your Binance address and send your Bitcoin.
Once you have your Bitcoin on your Binance, you can now use it to buy XLM. Using Binance is pretty straightforward. So, I would say you won’t have any trouble buying XLM with your Bitcoin.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
Hi. I Have some unwanted Bitcoin cash. How can I buy lumens with it?
Where would I store the Lumens?
Hi Ray,
Thanks for getting in touch with finder.
There are different ways you can buy lumens with your Bitcoin Cash.
First, you can sell your Bitcoin Cash and turn them into fiat money. From there, you can use your fiat money to buy lumens.
Second, you can find an exchange that allows you to buy lumen with Bitcoin Cash. On this page, you will find exchanges that handle Bitcoin Cash.
Third, buy products with your Bitcoin Cash and then sell your purchased product for fiat money. From there, you can again use your fiat money to buy lumens.
Please go to this page to learn more about Bitcoin cash.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
By digital wallet, can I use my laptop or do I have to use my cell phone?
Hi Rick,
Thank you for your comment.
With digital wallets, you can actually use both a computer (laptop/desktop) and a cellphone (smartphone). Either way, you have to make sure to follow the standard security best practices when using these devices. I would encourage you to check this page to learn more about cryptocurrency wallets including, its types, how it works and even comparative wallets available in the network.
Hope this helps.
Regards,
Jhezelyn
How do I transfer XLM lumens from Binance to one of your wallets?
Hi Jeff,
Please note that we are not the developers of the wallets we feature on our site.
To transfer XLM lumens from Binance to a wallet, you need to have your wallet’s address, copy that, and paste it on Binance. The entire process can vary from one wallet to another.
It would also be helpful if you read our guide on Binance here.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
In Binance it doesn’t give you the option to setup your bank account. If I ever decide to sell stellar how do I get the funds? I don’t want to exchange it back to bitcoin because I will loose money.
Hi James,
To sell Stellar, you can find someone who wants to pay you with fiat money. You can just send your bank account details for that person to pay them and simply transfer your Stellar via Binance.
Another way for you to sell Stellar is to find an exchange that supports the coin that you have. You must also see to it that the exchange allows you to sell bitcoins. Generally, if the exchange allows you to sell, they would ask for your bank account info so the exchange can forward your money to your bank.
Alternatively, you can use other wallets or exchanges that allow you to set up your bank account. You will find out more about that by reviewing our table found under the subheading, “Exchanges where you can buy or sell crypto with USD.”
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua Infantado
I am new to crypto. How do I purchase Stellar (XLM)?
thank you
Hi Rainman,
Thank you for your comment.
There is no cryptocurrency exchange offering XLM for direct purchase yet. To buy this, you check our guide here on how to buy XLM.
Before you start trading, you should know first the ins and outs of cryptocurrency. You can check out our page here to check how this works.
Regards,
Jhezelyn
I would like to invest $500 U S in Stellar for future growth. Is this to small an amount? The Exchanges listed say payment by cryptocurrency which I don’t have. So how can I proceed?
Hi Larry,
Thanks for reaching out.
In the US there isn’t a cryptocurrency exchange offering Stellar Lumens for direct purchase.
You can buy Bitcoin or Ether through a cryptocurrency exchange, after your bitcoin or Ether hits your digital wallet, you can transfer them to an exchange offering stellar.
The page above has the list of exchanges where you can buy bitcoin or Ether and the list of exchanges that supports XLM.
Cheers,
Joanne
I want to add 1000 to invest in Steller, how do I do this?
Hi Mike,
Thank you for your inquiry.
If you are looking at investing, you can start purchasing Stellar Lumens (XLM) via the exchanges (listed in the table above). You would also need to sign up for a Stellar Wallet (Stellar supported wallets are also listed above) as well to store your token.
Please also note of the possible risk associated with all digital currencies, including complete loss of value. Moreover, before purchasing Lumens, it’s is encouraged that you consult the Consumer Advisory brief by the Consumer Financial Protection Bureau (CFPB) on the potential risks associated with digital currencies.
Hope this helps.
Cheers,
May