As a branch off of Ripple, and created by it’s original founder, Stellar is an open-source technology designed to be a distributed payment system. But unlike Ripple, that focuses on financial institutions, Stellar is looking at the little guy. Their core strategy is to be more ethical and focus on individuals.

Buy Stellar Lumens

There is currently no way to buy XLM directly. So the only way to buy XLM is to purchase BTC to use on an exchange, and then switch it to XLM.

Step 1: Choose Your Trading Platform

Firstly you will need to decide on your cryptocurrency trading platform and create an account there. The choice of platform isn’t very important as a beginner, what really matters is a trading platform that you are comfortable using..

Choose one of these platforms and complete the follow steps to get started:

Binance
Go to Binance and create a new account if you do not already have one.

Once your account has been confirmed, log in to your Binance account and click on funds at the top right, then “Deposits Withdrawal”.

Select and copy your bitcoin address.

Look in the “Bitcoin” list and click the Bitcoin deposit button. Then a series of numbers appears in the “BTC Deposit Address:” field. You must copy this series for the next step. This is your bitcoin wallet address.

Go To Bit-z and create a new account.

In the Balances page you will to search for Bitcoin in the list. If all goes well, you will find it at the top.

Next click on the option of Bitcoin and then on the next page copy the Deposit Bitcoin (BTC) address, which the set of numbers and letters.

You’re told that you’ll need a trade password, you can create it and then go back to your Balance.

You need this address for the next step.

STEP 2: BUY BTC

The second step is to get your Bitcoin, you can do that at a broker such as BTCdirect .

If you’re buying BTC for the first time from these brokers, you will be asked to confirm your bank account.

Upon payment you will be asked to enter a bitcoin address. You must fill in the address that you have copied at Binance.

STEP 3: WAIT UNTIL YOUR BTC HAS ARRIVED

Once you have purchased Bitcoin and entered the correct BTC deposit address with the payment, you have to wait until the BTC arrives in your wallet.

This process can take up to ½ hour, so don’t worry if it’s not immediately visible on the exchange.

STEP 4: BUY XLM

Once your Bitcoin has arrived at your trading platform, it’s time to buy some XLM.

Binance
Go to the Binance trading exchange (click the top left on exchange and choose Basic) and use the search function within BTC Markets to find the XLM/BTC trade.

Once on the XLM/BTC trade page you can look in the left box marked with Buy XLM. Here you can decide how much XLM you want to buy using your Bitcoin.

If you then press Buy XLM your order will be placed. When the order is filled you will see your number of XLM on the right-hand box or on your balance page.

Enter the Bit-z homepage and use the search function within BTC Markets to find the option to trade XLM/BTC.

Use search to find the XLM/BTC trade.

Once on the XLM/BTC trading page you can indicate in the left box marked with buy XLM. Here you can decide how much XLM you want to buy.

If you then press Buy XLM, and enter your trade password that you created earlier, your order will be placed. Once the order is filled you will see your number of XLM on the right-hand box or in your balance page.

Congratulations you’re now the proud owner of XLM.

How Stellar Works

Stellar is designed to be a matchmaker for currencies, it wants to facilitate worldwide financial transfers and exchanges in any traditional fiat currency or cryptocurrency. Stellar utilises a decentralised blockchain protocol, which allows for the transfer of money across borders anywhere around the world in a fast, secure and cost-effective manner.

Much like Ripple, the main differences between these two currencies are while Stellar focuses more of a focus on simplicity and scalability, as well as on functionality to help move money in remote areas at lower costs, Ripple focuses on helping financial institutions save money through international exchange.

Stellar focuses to do this in three different ways.

Direct exchange. A user on the network can make direct currency exchanges. For example, if person A wants to trade USD for AUD and person B wants to trade AUD for USD, it can match them and automatically and carry out the exchange for the requested amounts.

Exchange through XLM. Stellar can use Lumens (XLM) as an intermediary currency between USD and AUD (or other currencies) and if 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 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 trying to do all of the above at the same time. When you make a transfer within the network, it will aim to provide the best possible rates every time.

However, if you want to send or receive money rather than make an exchange into different currencies, it can do that by directly connecting individual entities.

Stellar Components

When using the Stellar network, you’ll typically have Ledgers and Anchors.

The ledger. This is a central ledger of every account on the network and currencies that it holds. This information is needed to make transfers around the network and between users.

The anchors. These are trusted entities on the network that hold any currencies that are being transferred. An anchor might be anything from a bank, or a person in a remote village who takes the money online and then hands the recipient cash.

The Fight To End Poverty

When you buy into Stellar, via Lumen (XLM), you are supporting the nonprofit organisation Stellar.org, which utilises the technology to fight poverty in the developing world. The mission-statement, taken from their website, states

“With a team of top technology and finance professionals, the nonprofit Stellar.org expands access to low-cost financial services to fight poverty and maximise individual potential.”

Operational costs for the organisation are paid for with a small portion of the initial supply of Lumens (5%) and public donations.

While it may be a bit early to say we have entered the age of Cryptocurrency 2.0, the next step for the market is fulfilling the real-world needs outside of making investors money. Bitcoin established itself as the first great digital asset to retain and grow in value. While, Ripple is attempting to reshape the world of bank to bank transactions, IOTA is tackling how businesses interact and opened the door to microtransactions.

Stellar.org, using the Stellar network and Lumen currency, wants to create a system for the developing world that circumvent banks, exchanging money through multi-currency transactions, particularly in regions of high diversity and low monetary stability, and provide fast liquidity to individuals looking for a secure payment service.

Partnership with IBM

A huge factor to the rise in the price of XLM was the announcement in October that IBM had partnered with Stellar to provide a payment service throughout the South Pacific.

“The significance of the news, which IBM announced on [October 16], is that merchants and consumers will be able to send money to another country in near real-time, accelerating a payments process that typically takes days.”

The payment service encapsulates Australia, New Zealand, Fiji, and other countries within the South Pacific, with the goal of processing over half of all foreign exchange payments made in the region by the end of the year.

Ready to Takeoff?

It still remains to be seen how the Stellar project will differentiate itself from their competitor Ripple. While Ripple is taking an aggressive approach to being the future of the financial institution, with bank to bank transfers, Stellar seems much more content with operating in the developing world between user to user. The partnership with IBM will open the door to a massive population of potential XLM users, and as more and more developing world businesses turn to cryptocurrency, they will a way to fund their projects and conduct commerce.

Posted by jsi250

One Comment

  1. […] many happy memories at my twenties which overcame unhappiness. It first started when I invested in Stellar Lumens and got my business started with the money I got from […]

    Reply

Leave a Reply