Stellar Lumens Overview

Lumens are the cryptocurrency token that was created by the Stellar payment processing network. This digital token has been around since 2015 and has grown into one of the top ten cryptocurrencies by market capitalization. It is loosely based on the Ripple protocol and has been heralded as a good investment vehicle by digital asset speculators. The coin has remained relatively inexpensive to acquire  compared to other tokens.

The History of Stellar Lumens

Stellar Lumens was created in 2015. But to understand a bit about the digital coin’s history first requires an understanding of Stellar, the payment processing platform that led to its creation. Stellar was founded in 2014 as an open-source platform for value exchange. The creators of the platform are Jed McCaleb and Joyce Kim. McCaleb is best known as the founder of eDonkey, a peer-to-peer file sharing system that was popular throughout the early 2000’s.

Other individuals important to the development of Stellar include Keith Rabois, Patrick Collison, Matt Mullenweg, amd Greg Stein. Support for the platform is handled under a non-profit corporation known as the Stellar Development Foundation.

The Stellar software is designed to facilitate exchanges of money. It runs on servers which use the Internet to communicate with other Stellar servers. This creates a global network for money exchanges. The manner in which these transfers are carried out is very similar to the function of a blockchain.

It makes sense then that Stellar would create its own digital token for use with its system. This token is called Lumens and it has become one of the rising stars of the cryptocurrency market. Similar to Ripple in its design, the coin has also mimicked the popularity of Ripple and shown a propensity for strong gains.

On the Stellar network, Lumens and traditional fiat currencies can be used to make money exchanges. Lumens offered an alternative for those who find fiat to be too fluid as a method of transfer. There is no charge for individuals to use the Stellar network. Instead, the foundation set aside 5% of the initial Lumens for operating costs and also accepts donations from others.

It says something for the coin that its board of directors includes the founders of Stripe and WordPress. The partnership and collaboration with tech giants is an important way to add legitimacy to the company. It appears that Stellar is geared to stick around for the long term, and that could mean that it’s token will continue to increase in value.

Stellar Lumens Mining

Like Ripple, there is no mining of Stellar Lumens. All of the tokens for the coin were created in the beginning and are fixed at a certain number. Individuals cannot mine this coin as they would other cryptocurrencies like Bitcoin or Ethereum.

The truth is that mining coins today is beyond the scope of the cryptocurrency hobbyist. It requires expensive computer equipment and consumes too many resources to be a profitable endeavor. As an alternative, many individuals are choosing to turn to a mining collective so they can participate in mining at a lower cost.

Genesis Mining offers individuals an opportunity to purchase mining contracts that have a certain amount of hash power. These contracts being together a group of individuals who pool their resources to purchase shares of the mining equipment owned by Genesis Mining. The company has mining farms in secure locations around the world. They also provide all the maintenance and upkeep on the equipment. Individuals only pay a flat fee for a contract and share the rewards that are earned when coins are successfully mined.

Stellar Lumens Use and Acceptance

One of the things that has set Stellar apart and increased its popularity is the announcement of major partnerships with IBM and the KlickEx Group. The partnership was developed to create a cross-border payment system, and the project has been met with great enthusiasm. It also helps that media outlets like Fortune have gotten behind the news and heavily promoted it.

These types of partnerships will likely increase the value of Stellar Lumens as an investment vehicle. At the present time not all cryptocurrency exchanges are offering the token for sale. One that does is Binance. Users can purchase Stellar Lumens there, and it is also possible to use other cryptocurrency assets to trade for Lumens.

It is possible to spend Stellar Lumens in certain outlets. Some websites are now creating platforms like EBay or Craigslist which permit sales of various items and allow users to pay with digital money. There are also sites which sell gift cards to retailers like Amazon. Yet, while the coin is still being developed and reaping the benefits of its important partnerships, holding it as an investment vehicle is the primary way individuals are using the currency.