The recent rise of Bitcoin affected other coins positively, and one of the coins in the race for top spot is Stellar. The coin shrugged off major challenges, overtaking Litecoin to maintain a prime spot to become the 6th biggest cryptocurrency in the market.
STELLAR ON THE RISE
The fantastic rise of Bitcoin to $7,471, which is above the $7,000 mark it set in this week was a delight to the ear of investors and traders alike, but as the price of Bitcoin jumped, other coins also benefitted from the windfall. Among them are Stellar Lumens, which experienced the even more significant gains of almost 30% over the week.
The amazing leap allowed it to surpass Litecoin by market capitalization. This implies that Stellar is now at the 6th position with a market cap of about $5.4 billion compared to $4.8 billion of Litecoin.
Charlie Lee, the creator of Litecoin, twitted that “Congrats on passing Litecoin’s market cap.” That said, it doesn’t make sense to compare market caps of coins that are “printed because they have an inflated market cap. Maybe I’m old school, but I only care about decentralised measurable coin” he concluded.
In Lee’s opinion, market cap index is not the most accurate metric to rank cryptocurrencies “For me, it doesn’t reflect decentralisation nor how it was created.” The Litecoin founder also emphasised that digital tokens like Ripple, should not be in the same category as proof of work “mineable” cryptocurrencies like Litecoin and Bitcoin.
He, therefore, posted an alternative ranking list displaying mineable coins only, and the removal of EOS, CARDANO and IOTA were glaringly visible from the top ten. Historically, the market capitalisation metric has not been reliable; it should be noted that the coinmarketcap.com ranks any digital coins based on market cap metrics by default, so the metric does not show how decentralised a coin is.
An example of a coin that got the market cap ranks only to crash and burn is the Bitconnect coin that was revealed to be a pyramid scheme.
STELLAR SHOWS STABILITY
Stellar is an open source protocol for value exchange, founded in early 2014 by Jed McCaleb and Joyce Kim. The platform connects people to low-cost financial services, to fight poverty and develop individual potential. Only this week, it received certification for both its platform and its Lumens (XLM) cryptocurrency.
It also recently signed a deal worth $500 million (in XLM) to buy blockchain finance startup, Chain.
With the SEC stating that decentralised coins aren’t securities, it is still up in the air whether digitally “printed” tokens regardless of whether they are for-profit or non-profit philosophies will fall under the purview of the securities regulator.