Many are excited about Stellar’s potential to change the world’s financial systems, and we could soon see it follow in the footsteps of Ripple—in fact, IBM is using Stellar to compete with Ripple.
In this guide, we’re going to show you how you can start investing in XLM on one of the world’s largest exchanges, Binance.
What is XLM?
First, there is a classification to be made. Much like Ripple and XRP, Stellar is the blockchain network, and Lumens (or XLM) is the cryptocurrency used on the Stellar network.
The similarities between Stellar and Ripple don’t end there, however. Both networks serve the same function, to enable instant, cheap, cross-border transactions, focused on the banking and financial sectors. In fact, Stellar creator Jed McCaleb was one of Ripple’s co-founders. He served there as CTO before leaving the company to create Stellar.
Stellar’s main concept is to act as a currency exchange protocol. It will let people easily transfer between different currencies, by using Lumens as a go-between. In short, if someone wants to exchange USD to EUR, Stellar will do this by exchanging USD to Lumens, and Lumens to EUR. The network is supported by businesses running individual nodes, making it a little different to regular mining cryptocurrencies.
Stellar works in a very similar to Ripple. The goal is to make it easier and cheaper for financial companies and individuals around the world to process cross-border transactions. The virtual currency used on the Stellar network is fast and cheap to use, which means that it is very efficient for financial companies and retail investors that want to move funds.
In order to use the Stellar network users will need to have lumens (XLM) to pay for transaction fees and make accounts on the live Stellar network.
Despite being one of the largest coins in the world right now, not many Fiat-Lumens pairs are available. So the best way to get XLM is to first buy a currency like Bitcoin or Ethereum, and trade for Stellar Lumens on an exchange, such as Binance.
Although there are many cryptocurrency exchanges around the world, Binance is one of the largest digital asset exchanges in the market. As reported by CoinMarketCap, the platform had a market capitalization of $800 million in the last 24 hours. That means that the exchange is one of the largest in the world.
XLM has different trading pairs in the market and can be purchased for Binance Coin (BNB), Bitcoin (BTC), Ethereum (ETH), Paxos Standard (PAX), TrueUSD (TUSD), USD Coin (USDC) and Tether (USDT).
Here’s how to start investing in Stellar Lumens:
Step 1: Register on Binance
If you haven’t already, you will need to register an account on Binance. Their interface is very user-friendly, and the process should not take long.
Step 2: Verify your account
Binance requires you to submit several KYC (know your customer) verification documents before you can start trading. Also, you will need to set up secure 2-Factor Authentication to protect your account.
Step 3: Send BTC or ETH to your Binance account
Once your account is active, you will have to deposit Bitcoin or Ethereum to your Binance wallet.
If you don’t already own one of these coins, you can buy with credit or debit card on Coinmama or Changelly, or a fiat-supported exchange like Coinbase.
Once you have BTC/ETH and are ready to send to Binance, go to the top navigation bar, select “Funds” and “Deposits”.
Select from the dropdown menu whether you want to deposit BTC or ETH. This will give you an address to send your coins to. Make sure you only send the selected currency to that address (i.e. only send Bitcoin to the Bitcoin address). If you send any other coin, it could be lost.
Step 4: Wait for confirmation
Depending on the network load, it may take a few moments for the transaction to go through.
Binance is also allowing users to purchase digital assets using a credit card, however, there may be some digital assets not available for purchase with this method.
Step 5: Find and select the BTC or ETH pair
Once you’ve deposited Bitcoin or Ethereum to your Binance wallet, you’ll need to move to the exchange section of Binance. Do this by hovering over “Exchange” on the top bar, and select “Basic”.
Now you are in the exchange area, go to the right-hand side, where it shows pairs for BTC, ETH, BNB, and USDT. Choose the coin you deposited earlier, and search for XLM. Click on the pairing to bring up the…
Read More: Guide: How to Buy Stellar Lumens (XLM) from Binance