The Stellar (XLM) blockchain was launched in 2014 as a fork of the well-known XRP project. Both projects share some common goals, including efficient cross-border transactions. Each Stellar account must hold a small amount of lumens, the network’s native token. The maximum supply is capped at just 50 billion. In this guide, we’ll explain how to buy XLM and where to buy Stellar lumens safely.
While similar to XRP at inception, Stellar also focuses on decentralized finance (DeFi), empowering network users to interact with financial applications without intermediaries. The network also brings greater decentralization compared to XRP and its deep links to Ripple. Let’s learn how the Stellar network works, what you can do with XLM tokens, and where to buy XLM if you think it’s a fit for your portfolio.
Stellar Lumens (XLM) Coin Overview
Stellar Lumens (XLM) is the native token of the Stellar blockchain network. The project launched as a fork of the XRP Ledger, and Stellar operates as a decentralized alternative to XRP’s tightly controlled validator network and Ripple-centric XRP supply. Like XRP, XLM enables fast and affordable payments, with typical transaction costs of a fraction of a penny.
Partnerships with worldwide payment providers like MoneyGram illustrate the utility of Stellar’s network and the real-world application of blockchain technology as a more efficient alternative to legacy payment rails. Franklin Templeton now also uses the Stellar blockchain to record transactions for its money market fund.
Stellar was co-founded by Jed McCaleb, a blockchain industry icon who also founded Mt Gox and co-founded Ripple. Fellow co-founders David Mazières and Joyce Kim helped launch the project as a protocol to send currency pairs and tokenize assets on the blockchain. The network uses proof of agreement (PoA) as its consensus mechanism, allowing anyone to set up a node and participate in network security.
How to Buy Stellar (XLM) in 2024
For this walkthrough on how to buy XLM, we’ll use Coinbase, which lets you buy Stellar Lumen instantly after you set up your account. The Coinbase platform is the world’s largest publicly traded crypto exchange and supports trading in more than 100 countries worldwide.
3) Create a Coinbase account
Visit Coinbase to open an account if you don’t already have one. A basic account is free, but you’ll have to add a funding method, which we’ll cover in a later section.
Coinbase will ask for your email address, after which you’ll need to provide your name, address, and other basic information.
During setup, you can also set up two-factor authentication (2FA). By default, Coinbase uses SMS to verify transactions, but you can also use the Coinbase mobile app and your email address to secure your account.
2) Verify Your Identity
Most crypto exchanges also require proof of identity to comply with regional Know Your Customer (KYC) regulations. You’ll need to upload a clear and complete picture of your driver’s license, passport, or other government-issued ID.
Coinbase makes the process easy, and ID verification can take as little as 10 minutes. However, Coinbase advises new customers to allow up to two days.
3) Add a Funding Source
Next, you’ll need to add a funding source. Payment options vary depending on where you are in the world. However, Coinbase supports bank deposits in many countries as well as debit card transactions in many areas.
PayPal is available for purchases in the US, although PayPal can only be used for withdrawals in some countries.
Connecting your bank account is the least expensive way to trade on Coinbase and many other exchanges. Bank-funded deposits are free in the US. By contrast, debit card and PayPal transactions come with additional fees. You’ll pay about 2% to deposit via PayPal and a variable fee for debit cards that’s combined with a trading fee.
Note: Debit cards can only be used for instant purchases. To deposit a balance to use later, you need to use a bank transfer, PayPal, or a similar supported account funding method.
4) Buy XLM
Once your account is funded, you’re ready to buy XLM.
We can use Coinbase…
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