Stellar (XLM)

What is Stellar?

Stellar is a layer-1 payment network, and XLM is its native asset designed for fast and low-cost value transfers. The project was launched in the year 2014 by founders Jed McCaleb and Joyce Kim. To secure the network, Stellar utilizes the stellar-consensus-protocol rather than traditional proof-of-work or proof-of-stake mechanisms. This specific consensus model directly supports its primary use cases, which include facilitating cross-border payments, handling remittances, and enabling asset issuance on the blockchain. Today, Stellar maintains its position as a prominent digital asset network, currently holding the rank of 13 in the broader cryptocurrency market alongside related tokens like XRP, USDC, and BTC.

How does Stellar work?

The Stellar network operates using the stellar-consensus-protocol to validate and record all network activity. This specific consensus mechanism relies on a federated voting system rather than energy-intensive mining processes. Through this specific protocol, the network achieves agreement on the state of the ledger quickly and efficiently.

Network participants include various nodes that communicate with one another to maintain the shared ledger. Some of these nodes act as validators, which means they actively participate in the consensus process by voting on transaction validity. Other participants simply run watcher nodes to observe the network and submit new transactions without participating in the voting process.

When a user initiates a transfer, the transaction is broadcast to the network of active nodes. The validator nodes then group these pending transactions and use the stellar-consensus-protocol to confirm their legitimacy. Once agreement is reached among the validators, the transaction is permanently settled on the blockchain and the transferred value becomes available to the recipient.

Stellar use cases

Stellar tokenomics

The tokenomics of the Stellar network are defined by a fixed maximum supply model. According to the network parameters, the absolute maximum supply of XLM is capped at 50001806812 tokens. Out of this total hard cap, the current circulating supply stands at 34165163913.7767 XLM. This means that a significant portion of the total supply is already active and circulating within the layer-1 payment network. Because there is a strict maximum limit on the number of tokens that can ever exist, the asset is not subject to unlimited inflationary issuance. The stellar-consensus-protocol manages the network without requiring newly minted tokens to compensate energy-intensive miners, which aligns with the overall fixed supply structure of the ecosystem.

Stellar price history & milestones

The Stellar network officially launched in 2014, introducing its native asset to the broader cryptocurrency market to facilitate fast and low-cost digital value transfers. Over the course of its trading history, the token has experienced notable price fluctuations across different market cycles. The asset reached its all-time high price of $0.9381 on 2018-01-04 during a period of widespread market activity. Conversely, the token recorded its all-time low price of $0.001227 on 2014-11-18, which occurred shortly after its initial market introduction. Today, Stellar remains a highly recognized layer-1 project within the digital asset space, currently holding a market rank of 13 among all tracked cryptocurrencies.