Stellar Lumens (XLM) and XRP (XRP) are two cryptos aimed at cross-border payments, but XRP is a clear front-runner in this market thanks to multiple partnerships. However, from a price perspective, Stellar is performing better. At the moment, it is closing in on XRP, and has gained more than 20% in the day to hit a high of $0.30. That’s a few cents shy of XRP’s current price. So, what’s behind this pump?
There are a number of factors that are pushing Stellar Lumens at the moment. The first one is the possibility of a Coinbase listing. Stellar was among a few cryptos that Coinbase recently announced that it could be adding to its exchange. This is driving investor expectation that Stellar could be the chosen one, and push up the price. It is for the same reason that Ethereum Classic (ETC) has pumped in recent weeks.
The reason behind this optimism is the fact that Coinbase is one of the most important exchanges in the United States. Therefore, any crypto that gets listed on it naturally gets increased volumes from American crypto investors. As such, until Coinbase comes out and makes it clear that they are listing or not listing Stellar Lumens, the price will continue to pump. If the listing is confirmed, Stellar will pump even further. Conversely, if it doesn’t get listed, its price could ease, but the overall momentum will remain bullish.
That’s because Stellar Lumens (XLM) has a partnership with IBM, and IBM has in the recent past entered into partnerships with a number of governments and financial institutions. The prevailing sentiment is that any time IBM enters into a partnership that involves payments, it will involve Stellar in one way or the other. For instance, recently IBM entered into a partnership with the Australian government to develop blockchain technology.
Stellar investors postulate that this could mark the beginning of a possible adoption of Stellar by Australian banks. This has contributed to the recent surge in interest in Stellar Lumens, interest that has been amplified by the possibility of a Coinbase listing.
Of course, Stellar is also being supported by Bitcoin’s bullish sentiment. In the last 4 days, Bitcoin has been rising and is currently trading above $7400. It’s dominance in the market has jumped to 42%, which means that the altcoin market is more now more likely to move in tandem with Bitcoin’s price. Therefore, Stellar like the rest of the market is rising because bitcoin (BTC) is bullish. The other factors discussed above are simply giving Stellar more momentum that most of the other altcoins.
So does this mean that Stellar Lumens (XLM) is about to dethrone XRP (XRP) in cross-border payments. That’s highly unlikely. That’s because XRP already has a headstart in the market, in terms of partnerships. It’s also better placed as a liquidity tool for cross-border payments. XRP’s more centralized nature is actually a good thing, when it comes to providing liquidity for banks.