Summary
- Stellar has shown that governments can still be receptive towards digital currencies.
- It is counting on institutional investment as a core component of its growth.
Stellar’s price rally has been on an upward trajectory, helping it achieve a market capitalization of about $9.3 billion. With that, Stellar currently ranks as the eleventh most valuable digital currency. The digital asset has increased in value by 505% in the past year.
A solid foundation and institutional backing
The institutional acquisition of Stellar has gained traction. In the past week, a housing company in Germany, Venovia, revealed that it had distributed digital bonds valued at around USD 24 million to Stellar’s blockchain. The distributed bond is expected to use Stellar’s technology in transferring rights of ownership in real estate.
Last month, Jonathon Miller, the managing director of Kraken in Australia, declared that Kraken had more than duplicated the number of trading sets available to clients who use the Australian dollar and pound sterling. Stellar is recorded among the digital currencies that can be traded against the Australian dollar and pound sterling.
Grayscale has been purchasing specific digital currencies in bulk. Early this month, the company added more than 2 million Stellar Lumens to its holdings. Following its latest purchase, Grayscale currently holds nearly 57 million Stellar Lumens.
About two weeks ago, Kaleo, a well-known trader in digital currency and analyst, said he was stacking up about three digital assets. Among these was Stellar Lumens that he believes has growth potential.
The high-value gems
Early this year, Ukraine’s Ministry of Digital Transformation validated the Memorandum of Understanding with Stellar Development Foundation. The move was geared towards adopting the Stellar system as a “central bank” that majorly deals in digital assets. In the end, this partnership aims at creating a suitable environment for digital assets.
In the most recent development, Stellar is among the digital currencies integrated by Skrill in its new online withdrawal wallet. This is a major achievement not only for Skrill but for the global cryptocurrency market. This is because it is another step towards mainstreaming cryptocurrencies in global financial transactions. The new update will enable Skrill users to directly withdraw their assets to a digital currency they prefer.
A claim to the future
The future looks great for Stellar prices. About a month ago, there was widespread speculation that Signal, a messaging app, was keen on launching a digital asset based on Mobilecoin. If the venture bears fruit, it will be a significant gain for Stellar since Mobilecoin is a token generated from Stellar’s system. That may drive Stellar prices further up.
Unfortunately, it is not known how regulators such as the Ukrainian Government will react in the future with regards to this currency not being regulated. This may reverse some of the gains made by Stellar and destabilize its growth. Ripple is already feeling the heat after its much-publicized legal battle with the Securities and Exchange Commission (SEC).
XLM/USD: Technical outlook
At the beginning of this week, Stellar’s price decreased by about 6% before retracing its route back to the ascending trajectory.
At the time of this writing, the price is nearly $0.414, representing gains of about 4.471% within the last 24 hours.
An XLM/USD price above $0.349 signals a bullish market with a likelihood of a rise towards a resistance level at $0.406. A breakthrough in this barrier will send prices towards 0.446, where it will meet the second resistance level. The XLM/USD pair will find support at $0.398.
If XLM breaks the second resistance level, it could retest the 0.471 mark.
