Why is Stellar (XLM) price up this week?
Stellar’s pre-announcements may have caused traders to create multiple scenarios for potential XLM developments, but their impact on the XLM price could be short-lived.
The Stellar token experienced a notable 11.5% increase in value between Sept. 2 and Sept. 8, a novelty given that Bitcoin and most altcoins are down for the week. The surge came after Stellar (XLM) tested the $0.113 support level, which marked its lowest point in the past eight weeks. The price upswing followed a preliminary announcement made by the Stellar organization on social media.
While the announcement was somewhat cryptic, it hinted at something significant occurring on Sept. 12, with phrases like “something cool is dropping” and "change” on the horizon.
More recently, on Sept. 7, Stellar further heightened expectations by teasing a potential partnership. However, similar to the earlier announcement, no specific details were provided, with only words like “brand” and "real world” used, suggesting a possible rebranding and a shift toward real-world assets (RWA) like stocks, bonds and real estate.
Caroline Pham, one of the five commissioners of the Commodity Futures Trading Commission, emphasized on July 17 that recent court decisions regarding the classification of cryptocurrency assets would ultimately lead to regulatory clarity. Pham also stressed the significance of RWAs and highlighted the opportunities for modernizing financial markets through the tokenization of money market funds on blockchain technology.
No, it’s not likely that Elon Musk is coming to save XLM
Unfounded rumors circulated regarding Elon Musk’s X (formerly Twitter) potentially integrating XLM after the social network obtained a currency transmitter license from regulators on Aug. 28. It’s worth noting that X had previously received approvals from six other states prior to this latest announcement.
Elon Musk will build X into the worlds most valuable financial institution
— MASON VERSLUIS (@MasonVersluis) August 31, 2023
He is acquiring all the necessary licenses to integrate CRYPTO into Twitter/X
My hope is that $ETH, $XRP or $HBAR or even $XLM is one day involved pic.twitter.com/YjRTxF0pMz
Moreover, it’s important to note that even if X decides to integrate multiple cryptocurrencies, XLM’s current market capitalization of $3.4 billion falls short of making it a top 20 contender. A similar analysis, using Messari Crypto’s "real volume” ranking, positions XLM as 20th in terms of trading volume, trailing behind competitors such as Bitcoin Cash (BCH), Sui (SUI), Litecoin (LTC) and Ripple’s XRP (XRP).
In mid-August, the Stellar Development Foundation (SDF) leveraged its cash treasury to become a minority investor in payments provider MoneyGram International. SDF, the entity behind Stellar’s native token development, had previously established a commercial partnership with MoneyGram in 2021.
According to Denelle Dixon, SDF’s CEO and executive director, this investment would contribute to MoneyGram by expanding its digital business and exploring blockchain technology.
Stellar's website states:
“Your application can now seamlessly connect to MoneyGram’s retail network through a single integration, allowing users to deposit or withdraw cash from their digital wallets via Stellar USDC without requiring a bank account."
The website adds the integration’s various benefits, including the ability for users to “top up their digital wallet balance with cash," conduct “near-instant, low-cost cash transactions” using “dollar digital currencies” and complete Know Your Customer procedures “through MoneyGram’s user-friendly interface."
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