What should you look out for when considering which cryptocurrency to invest in? In this article, we’re going to look at precisely this. We’re going to do a deep dive into both ETH and XLM, examining what they are, their history, their market cap, daily transactions, and similarities and differences.
We’ll also be looking at where you can buy them and how to exchange them with each other. Finally, we’ll explore what the future might look like for these currencies.
Without further ado, let’s get started.
When analyzing a cryptocurrency, it’s essential to start at its roots. Read along as we take a look at the history of Ethereum and Stellar:
The concept of Ethereum was first released back in 2013 by Vitalik Buterin. However, it wouldn’t be until 2015 that Ethereum would be released to the public. That said, investors could still purchase coins as early back as 2014.
Ethereum has undergone a significant change in how it operates, from a proof-of-work to a proof-of-stake consensus mechanism.
Stellar was launched in 2014 by Jed McCaleb and the Stellar Development Foundation. XLM is the currency that is used on the network.
The Stellar networks connect payment systems, banks, and people to facilitate cross-asset value transfers. Stellar has been highly successful as an altcoin, boasting a very high market cap.
If you don’t already know, altcoins are any cryptocurrency other than Bitcoin.
What Are They, And Why Were They Created?
Another critical variable to consider is why developers made these digital currencies. Remember, not all crypto is made to be a decentralized form of currency. Let’s explore this in detail:
Ethereum is an open-source blockchain-based software that enables smart contracts and decentralized applications to run on it. At the time of writing this, there are thousands of applications that have been built on the network. And this number is constantly growing.
Ether is the digital currency used in financial transactions on the smart contract network and can also be used as a store of value.
Stellar is a decentralized open-source payment network that uses blockchain technology to quickly transfer funds at a low cost. Stellar works with any money, be it the digital representation of the euro or the US dollar.
Stellar Lumens (or XLM for short) is the cryptocurrency used to create and trade digital representations of currency.
The price history of a cryptocurrency is a crucial factor to consider. It helps investors get an idea of how the price of a cryptocurrency is likely to behave in the future. Let’s take a look at this in detail:
Ethereum has a rather lengthy recorded price history. In 2015, you could purchase this cryptocurrency for less than a dollar. This changed in 2017 when Ethereum spiked in price to hundreds of dollars and even further.
2018, 2019, and 2020 show a consistent trend, leveling at a couple hundred dollars. However, the 2021 bull market would show differently, boosting its value to the thousands of dollars.
Although, after this, the price dropped slowly, reaching where it is today at $1,273.36. It’s been a long road for this cryptocurrency.
XLM’s price was quite “flatlined” from 2014 until 2017, when it experienced quite a few spikes, continuing into 2018 but ultimately leading to a higher average price through 2019 and 2020.
It went from around $0.002 to approximately $0.05. However, 2021’s bull market would take it even higher, followed by a slow but relatively consistent fall to its value today at $0.08513.
The market capitalization of a coin shows us how dominant it is in the market.
We will explore Ethereum’s and Stellar’s market capitalization next:
Ethereum currently boasts a market cap of $156,213,738,768, putting it at rank 2 of the world’s cryptocurrencies. This crypto coin has a circulating supply of over 122 million.
XLM has a market cap of $2,202,260,028. This places it at rank 26 of the global cryptocurrencies. It also boasts a circulating supply of over 25.5 billion.
How many daily transactions do ETH and XLM see in a day? We’re going to explore this variable in the following sections:
At the time of writing this, Ethereum’s most recent 24-hour transaction value is $6,840,347,438.
XLM’s present 24-hour volume is $39,669,538. This is still a significant amount, despite being much lower than ETH.
The block size of a cryptocurrency is an essential indicator of its performance. Larger block sizes allow for higher transaction-per-second rates but come with some issues.
Ethereum, while previously boasting a block size of 80 KB, now has a maximum block size of 1 MB.
XLM’s block size, along with other variables, allows for thousands of transactions every second.
The primary similarity is that Ethereum and Stellar are both smart contract-enabled blockchains.
Although you’ll find both Stellar smart contracts and Ethereum smart contracts on these networks, there are some key differences, namely:
Stellar uses the Stellar Consensus Protocol to complete transactions and reach consensus. The Stellar blockchain does not rely on a closed system for recording financial transactions accurately.
On the other hand, the Ethereum blockchain uses a proof-of-stake consensus mechanism for its transactions.
Stellar is also not as flexible as Ethereum. Because it boasts greater simplicity, it’s more limited than Ethereum. Ethereum can do everything Stellar can and more.
Are there any risks to investing in Ethereum or Stellar? While all cryptocurrencies are subject to inconsistency and volatility, some risks may be unique to a specific cryptocurrency. Deciding on the best platform to invest in involves considering risk.
The primary risk with investing in Ethereum is the large number of competitors that offer similar but faster smart contract blockchains. This may move it from its number 2 position, being second to Bitcoin.
Another risk involves governmental regulation, which is currently looming in many countries. This includes the UK and the US, where talks about cryptocurrency regulations persist regularly.
According to experts, XLM is considered a low-risk investment. However, this is based on current trends and may change. Although right now, it’s definitely in line as the best platform to invest in.
XLM is low-risk and a solid investment choice for people who prefer to make long-term cryptocurrency investments. It’s got a firm foundation. The same can only be said about some blockchain platforms.
Where to Buy
So, where can you buy Ethereum and XLM? We’ll list this out for you next.
You can buy Ethereum at several different places, including but not limited to:
- Cryptocurrency exchanges: this includes exchanges such as Bitfinex, Bitstamp, and Kraken.
- Cryptocurrency ATMs: these are located all over the US and may even resemble regular ATMs.
- Financial apps: Ether is available for purchase on different financial applications, such as PayPal.
You can even purchase XLM tokens on the crypto brokerage Robinhood.
Exchanging Ethereum (ETH) for Stellar (XLM)
You can exchange your ETH tokens for XLM using an exchange such as SimpleSwap. Platforms like this allow you to easily trade cryptocurrencies you currently hold with those you wish to purchase.
They’re fast and efficient and require you merely to enter your details and the wallet you wish to send the exchanged tokens to.
Are there any plans or developments for Ethereum and the Stellar network? In general, what does the future look like for these cryptocurrencies? Let’s explore this next.
The Ethereum network is currently planned to undergo another significant process known as sharding. This will distribute the storage and computational effort across the network. In short, it’ll make it more efficient.
This, paired with the long-standing efforts of the Ethereum development team, will likely place it in a positive light for the future. This is unlike some other blockchain platforms.
Crypto experts have some optimistic predictions for this coin:
- By 2025 it’d be reasonable to expect that Ethereum would be valued at $5,359.32 at the lowest. And it might be valued at $6,124.94 at the highest.
- By 2027 it may have a price of $7,911.38 per coin. Alternatively, it’ll have, at the most, a cost of $8,677.00.
- By 2030 it’ll have a minimum fee of a whopping $11,739.47 per coin. Or it’ll boast the maximum, a cost of $12,505.08 per token.
The Stellar development team has big places for the blockchain platform. They’re focusing on three “strategic building blocks,” namely: promoting diversity and inclusion, improving network innovation and scalability, and finally, activating network participation.
XLM, like Ethereum, has price predictions from analysts. These experts currently place Stellar Lumen’s price at an average of $0.279972 by December. By December 2030, they expect that XLM will be worth $1.75 per token.