Stellar Lumens

It indeed takes a lot of time for the Bitcoin transactions to be processed, and therefore, another coin called Stellar Lumens can take anywhere between 120 to 200 transactions simultaneously. Stellar Lumens is a digital currency similar to Ripple, and Jed McCaleb has created both.

What is Stellar Lumens?

Though both Stellar Lumens and Ripple have been based on the same premise, there is a significant difference, as the Lumens cater to helping individuals transfer money, rather than the institutions. McCaleb has taken a bottom-up approach with Lumens instead of going for the top-down approach found in Ripple. The Stellar network is a decentralized peer-to-peer framework, and Lumens is a token used on the network itself.

How do Stellar Lumens work?

The Wider Stellar Network use Lumens as tokens to send sums of money and convert currency. This is a decentralized peer to peer network. One type of currency can be sent from one peer through the Lumens, and it arrives as a different currency to the receiver. It will transition through several currencies during its journey to the receiver.

The Stellar Network does this by seeing if there is a straight currency pair swap available. If this is not the case, it sees whether there is a demand for the Lumens holder’s initial currency. Once it is able to acquire the Lumens, it can search for the pair of Lumens and the destination currency. Therefore, it allows easy transaction of value between those currencies that don’t have a commonly traded pair.

Benefits of Stellar Lumens

  • Speed

Using Lumens as a transfer method can be a fast way of transferring money to somebody, usually completing in around 3-5 seconds. It reaches the recipient faster than a wire transfer, especially in the case of cross border payment.

  • Cost

The cost of Lumens transfer is meager; therefore, it is a very competitive method of transferring money compared to other methods.

  • Ease of currency exchange

There may not be a comfortable currency pair to exchange money from one currency to another for certain currencies. With the help of Lumens, it can be carried out for sender & recipient without any issue on their behalf.

  • Decentralized

The Stellar network is decentralized, and this means that no authority controls the Lumens movement. The community authorizes transactions, and each transaction record is stored on the blockchain that everyone may access.

Stellar Lumens mining

It is not possible to mine Lumens, but instead, Lumens supply can be controlled by Stellar. In the start, 100 Billion Lumens were created and each year, the supply inflated by 1% for five years, until there was a vote by the Stellar community against it.

With the community’s advice, the number of Lumens were halved in existence to 50 billion and vowing not to make any more. Out of the 50 billion, only around 20 billion are in circulation because the SDF holds the remainder for promotional and development purposes.


There is no doubt that cryptocurrencies can be volatile in price, as one can easily make losses. You should not invest in cryptocurrency if you are not able to invest more than you can afford. With the large supply and low coin price of Stellar Lumens, some people consider it a dubious investment compared to the other cryptocurrency giants. It will become a different story when more people worldwide would end up using Stellar Lumens to transfer money.

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