Despite the temporary consolidation in the cryptocurrency market, Stellar (XLM) has been recording gains on all of its charts, growing its value nearly 100% since the year’s turn and sparking hopes it could overtake its all-time high (ATH) and even proceed toward $1.
That said, Finbold has analyzed the main factors that could lead this cryptocurrency toward hitting the psychologically important level of $1, bearing in mind that its ATH of $0.88, reached back in January 2018, is 529% higher than the price of Stellar at press time.
Increased use for micropayments
Small payments, typically less than a dollar, are often used to pay for things like online content, subscriptions, and gaming, but traditional payment processors like PayPal (NASDAQ: PYPL) and Western Union (NYSE: WU) have high fees for them, making these processors impractical for these uses.
Thanks to its low fees (around 0.00001 XLM or only a fraction of a cent) and fast transaction processing, the Stellar network is a good choice for micropayments, making it a potential competitor to the above traditional payment processors. Should it continue to gain more traction in this market, it could drive up the price of XLM.
Remittance market growth
Considering that the remittance market is a multi-billion dollar industry, as citizens working abroad are a lifeline for many countries around the globe, Stellar is very well-positioned to capture a significant portion of it thanks to its speed, scalability, and low costs.
Indeed, the volume of money that migrants send to their families and friends in their home countries is growing rapidly, particularly as there are hundreds of millions of international migrants, with the expectation that their number will continue to grow in the coming years.
Increased institutional adoption
In addition to being suitable for micropayments, Stellar’s above-mentioned qualities in cross-border payments make it a popular choice for banks and other financial institutions seeking to hop on the blockchain technology bandwagon.
As a matter of fact, Stellar has teamed up with multiple high-profile banking institutions across the years, including the Central Bank of Brazil, Western Union, International Business Machines Corp (NYSE: IBM), and Stripe. Continuation of such practices could help boost the demand for XLM and, with it, push its price higher.
FOMO (fear of missing out)
In the crypto market, ‘FOMO‘ can be a powerful force, creating a sense of urgency among investors, and it could also be a factor in the price of XLM. Specifically, as the price of Stellar’s cryptocurrency gradually increases, it could attract more buyers who are afraid of missing out on the potential gains, driving the demand and price of XLM.
For instance, people might experience ‘FOMO’ with Stellar because of its status as a well-known digital asset with a large community of users, as such, having the potential to reach a wider audience than some of its competitors. Moreover, its range of real-world use cases, such as for remittances and micropayments, also has the potential to spark this fear and XLM buying pressure.
Finally, the general atmosphere in the crypto landscape can have a strong influence on specific digital assets. In fact, the better people feel about the general crypto market, the more likely they are to invest their money in cryptocurrencies such as Stellar.
In particular, positive news and developments in the crypto industry can assist in triggering the overall bullish sentiment, and when traders are feeling bullish about crypto assets, they are more likely to dedicate a portion of their portfolio to them, which can also be the case for XLM.
Stellar price analysis
Meanwhile, the price of Stellar at press time stood at $0.1398, which represents a 0.52% gain in the last 24 hours and an increase of 0.25% across the previous seven days, adding up to the advance of 43.88% on its monthly chart, according to the data retrieved by Finbold on August 11.
Although it is impossible to say for certain when or if Stellar will, indeed, break its previous record of $0.88 and reach a new ATH of $1, as this market can be highly volatile and unpredictable, the above factors have enough strength to help its case, eventually possibly even hitting the coveted price level.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.