XLM Stellar in 2024 (deep research)Stellar (XLM)
Stellar is an open-source, peer-to-peer virtual currency network that first appeared in 2015 The network was founded by current chief architect Jed McCaleb, current chief scientist David Mazier, and former lawyer Joyce Kim, who has since left Stellar The network aims to make moving money across borders faster and easier, especially for those without access to traditional banking services.
The Stellar blockchain is a distributed ledger used to transfer digital currencies. The primary token of the Stellar blockchain is XLM. The Stellar blockchain uses the Stellar Consensus Protocol (SCP), which is different from the proof-of-work mechanism used in Bitcoin. SCP allows for fast and inexpensive transactions and does not require mining, making it more energy efficient Stellar transactions are confirmed within 5 seconds Transaction costs are extremely low: the average transaction cost is a fraction of a US penny.
The Stellar Development Fund was created to support the development and growth of the Stellar network. The goal of the fund is to promote global financial access, literacy, and inclusion. Stellar has a unique feature, Anchors, which are organizations that can hold deposits and make loans. This allows for a network of inputs and outputs for conversion between digital and traditional currencies Stellar is involved in various partnerships and projects to expand financial inclusion and improve cross-border payments For example, in January 2021, the Ministry of Digital Transformation of Ukraine announced its cooperation and collaboration with Stellar in the development of Ukraine's digital infrastructure.
Roadmap
The Stellar Development Foundation has published a strategic roadmap for 2023, focusing on three blocks to support and grow the Stellar network, ecosystem, and community:
Block 1: Utility is an indicator of growth - this principle aims to attract more developers to the network by providing utility. By focusing on the dysfunctional elements of the current system, Stellar aims to highlight and address them through the network. This includes bringing top-notch assets. Into the network, expanding access through global ramps, and honing in on use cases.
Block 2: Stellar - the network of choice - this block aims to make Stellar the standard for everyday financial services. The goal is to show that Stellar is a network that will not only survive but will set the standard in the industry.
Block 3: Stellar for Developers - This block aims to support the growth of the Stellar ecosystem by providing a clear path for builders to develop solutions. Stellar aims to make it easier for developers to get online and support them in building real-world solutions.
The roadmap also outlines a focus on expanding payments and remittances, leveraging the movement of digital value to provide financial services such as savings, loans, credit, and other transactions in a more accessible way. Stellar's goal is to make it easier for people to access financial services without creating the difficulties and challenges they face today.
Team
The Stellar team is highly regarded in the cryptocurrency space. They have a wealth of experience and expertise, and key figures such as Jed McCaleb, co-founder of Ripple, and Joyce Kim have been instrumental in the development and growth of Stellar. The team consists of more than 80 experts from various leading gaming fields, which is a testament to the diversity and high caliber of the employees.
In addition, the team includes veterans from industry giants such as Binance, ConsenSys, Google, and Microsoft, further enhancing their credibility and expertise in the cryptocurrency space. Stellar has also partnered with major financial institutions and governments, such as the Ministry of Digital Transformation of Ukraine, to create an ecosystem of virtual assets and a national digital currency This is a testament to their extensive experience and strong reputation in the industry.
Audit
Stellar has been listed on the Cyberscope platform, which gives Stellar's due diligence score of 88%, indicating a very low-risk level. The security score is 71%, indicating a moderate level of security. Stellar's audit history is not provided in the search. results, but it is noted that Stellar has not been audited by CertiK Additionally, the Stellar Development Fund (SDF) announced the launch of an audited bank that will distribute up to $1 million in security audit credits in coordination with six top-tier audit firms This initiative aims to support the growth and security of the Stellar ecosystem by providing financial assistance for security audits of projects being built on the network.
GitHub
The project repository seems to be quite active. There were 1860 commits in April!
This indicates a significant level of activity in the development and maintenance of the project. The project has an active community of developers contributing to various repositories. These include the core protocol, smart contracts, and multiple tools and resources for developers. The project has released new features and tools such as the Starlight wallet, which allows for private, instant and secure transactions This is a testament to the constant innovation and development of the project.
Ecosystem
The Stellar ecosystem has grown significantly, with many applications and projects coming online.
These include:
StellarX: An easy-to-use peer-to-peer trading platform for trading assets on the Stellar network.
Stellarport: A web-based interface to access the Stellar network, allowing users to trade assets, send payments, and create tokens.
Lobster: A mobile and web wallet for managing Stellar accounts and assets.
StellarTerm: An open-source client for the Stellar network that allows users to access a decentralized exchange and manage their accounts.
Stellar Lumens: The native digital currency of the Stellar network, used as an intermediate currency to facilitate transactions between different assets.
According to the latest data, the total value of assets locked in the Stellar ecosystem is $9.84 million. The high TVL indicates that a significant number of investors uses the protocol and that it has a high level of liquidity TVL in the Stellar ecosystem is a testament to the growing interest and confidence in DeFi's capabilities on the network As the Stellar ecosystem continues to expand, TVL can be expected to continue to grow, reflecting the growing popularity and utility of the network.
Stellar has also made significant strides in smart contracts in recent years with the introduction of Soroban Soroban is a smart contracts platform on Stellar that allows developers to create, deploy and interact with decentralized applications (dapps) on the network The Stellar Development Fund has committed $100 million to the Soroban Adoption Fund to incentivize the development of projects that leverage the network's smart contract capabilities According to the latest data, 466 projects are active on the Stellar network, demonstrating the versatility of the platform and its potential to revolutionize the way financial transactions are conducted.
Tokenization
Tokenization is the process of representing real world assets (RWAs) or financial products as digital assets on the blockchain It is a key feature of the Stellar blockchain network, allowing any developer or enterprise to issue assets on the platform The Stellar blockchain is designed to support the tokenization of assets, including fiat currencies and securities, in a secure and simple way This enables the creation of digital representations of real-world backed assets, which can then be moved around the world around the clock, quickly and at low cost Below are RWA's market capitalization statistics across various networks.
The process of tokenizing an asset on the Stellar network involves four main steps:
1 Creation of the issuing account: The first step is to create an account on the Stellar network that will be used to issue the asset.
2 Creating a distribution account: Next, a separate account is created to hold the issued asset.
3 Add a trust line for the asset to the distribution account: The trust line is a record of the asset and the maximum amount of that asset that the account is willing to hold This step ensures that the distribution account can receive and store the newly issued asset.
4 Transferring the asset from the issuing account to the distribution account: The last step is to transfer the asset from the issuing account to the distribution account.
Stellar's built-in software features allow for asset control, which means issuers can limit the use of an asset and who can own it by setting various configuration flags This provides a high level of flexibility and control for asset issuers.
Tokenizing assets on the Stellar network provides several benefits:
Reduced record keeping: Issuers can reduce the number of internal sources for record keeping by using the blockchain as the primary source of truth for non-PII data.
Increased market access: Issuers can expand their markets by offering their assets to the ins and outs and wallets built on the Stellar network.
Instant settlement: The Stellar network provides instant settlement 24/7, reducing the cost of processing financial transactions.
Interchangeability: Assets created on the Stellar network are interoperable with the rest of the digital asset ecosystem.
Low cost: The Stellar blockchain is known for its low transaction costs, making it an attractive choice for asset tokenization.
Tokenization on the Stellar network thus enables the creation of digital representations of real-world assets, providing a secure, efficient and cost-effective way to transfer and manage assets on the blockchain.
Bridges
One of the most notable bridges is Allbridge, which provides interoperability between Stellar and several other leading blockchains, including Ethereum, Solana, Polygon and Celo This bridge allows users to transfer assets between these networks, utilizing the unique features of each blockchain and enjoying the fast and inexpensive transactions that Stellar is known for Allbridge's integration with Stellar was made possible through a partnership with Ultra Stellar, a key player in the Stellar ecosystem An example of how Allbridge works:
Another significant development in Stellar interoperability was the introduction of Spacewalk, a trust-minimized bridge between Stellar and the Polkadot/Kusama ecosystems Spacewalk enables the transfer of stable tokens from the Stellar network to the Polkadot/Kusama ecosystems, opening up new opportunities for users to access a wide range of DeFi services The Stellar Development Foundation (SDF) also launched the Stellar Bridge Bounty Program, which supports the development of cross-chain solutions on the Stellar network This program has led to the creation of innovative bridge solutions such as Starbridge, which aims to create a robust integration between Stellar and Ethereum.
These bridging and interoperability solutions are critical to the growth and proliferation of the Stellar network, as they enable users to access a wider range of assets and services while taking advantage of Stellar's fast and low-cost transactions As the Stellar ecosystem expands, we can expect to see further developments in bridging and interoperability, further increasing the utility and reach of the network The need for bridges in the race to tokenize real world assets underscores the importance of seamless integration and interoperability in the financial ecosystem By enabling asset transfer between different blockchain networks, bridges play a critical role in facilitating tokenization of real-world assets, which is expected to unlock significant value and create new opportunities for investors and businesses alike As the demand for tokenized assets continues to grow, the design and implementation of bridges will play an important role in meeting this demand and enabling efficient and secure asset transfers between different blockchain networks.
Conclusion
Stellar is a truly outstanding project with a vibrant ecosystem with a significant number of projects and a wide range of opportunities Fast and inexpensive transactions, energy efficiency, and a focus on financial inclusion make it attractive to both developers and users Support for tokenization of real assets further extends the network's capabilities by enabling digital representations of a wide range of financial instruments The development of bridges and interoperability solutions on the Stellar network demonstrates its commitment to creating a more interconnected and accessible financial ecosystem These bridges enable seamless integration with other blockchain networks, extending the reach and utility of the Stellar network and making it an ideal platform for cross-border payments and tokenization of real-world assets.
All of the above factors point to the significant development of the Stellar project, as well as the price of XLM The growing interest in the network
and its adoption, as evidenced by the increasing number of TVLs and the development of bridging, interoperability solutions, suggest a large growth of XLM While it is difficult to predict specific news or events that will trigger the price to rise and get out of accumulation, I have already started accumulating XLM in my portfolio You can familiarize yourself with it at the link below the chart.
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