Although more unique altcoins like Stellar (XLM) have their own infrastructure, a decade since its inception, Bitcoin (BTC) still continues to be the ‘big daddy‘ of the cryptocurrency market. The Bitcoin price movements still happen to dictate the mood of the entire cryptocoin market.
This happens because most of the altcoins have its trading pair linked to Bitcoin. In turn, it shows that investors still trust Bitcoin as the most preferred and sound investment in the cryptocurrency market.
However, there are a few projects which have built their own robust infrastructure and announced their independence.
“Decoupling” from Bitcoin
Stellar (XLM) is one such project moving towards independence while “decoupling” itself from Bitcoin. Decoupling of altcoins basically means reducing their dependence to Bitcoin. To decouple from Bitcoin, altcoins require a higher price stability backed with a robust infrastructure.
Stellar is currently proving its mettle in the crypto market. Over the years, Stellar has emerged as a formidable player with signs of long-term sustainability.
The Stellar (XLM) project has built an entire ecosystem around itself. This includes a complete decentralized exchange, layer-2 scaling solutions like the Lightning Network, Stellar-stablecoins, etc. Furthermore, Stellar has gained high fiat exposure and liquidity with its presence on several big exchanges. It has also formed key partnerships with big companies while allowing them to build their decentralized applications.
If we look at it from a technical perspective, the Stellar technology is completely independent of Bitcoin. Hence, it doesn’t make sense to why Stellar reacts to Bitcoin fluctuations.
Attaining Investor Recognition
Apart from technology, one thing that truly helps an altcoin to decouple from Bitcoin is getting better investors’ recognition. Stellar is working towards establishing its individual credibility in the crypto space.
The reason why XLM price reacts to that of Bitcoin is that half of the total Stellar’s trading volume is accomplished by XLM/BTC and XLM/ETH trading pairs. On the other hand, the fiat trading pairs like XLM/USD contribute a minority trading volume. This inevitably causes the Stellar price to swing along with Bitcoin.
One way to reduce Bitcoin dependency would be adding more fiat/XLM pairs. Moreover, Stellar listing on popular exchanges like Coinbase will prove to be a major booster for the cryptocurrency.
Stellar (XLM) Gaining Traction in ICO Landscape
XLM is becoming more and more popular in the ICO landscape as a preferred platform for token launch. It is slowly but steadily eating into the market share of giants like Ethereum.
Over the years, this can turn to bring huge liquidity for the XLM tokens. Furthermore, Stellar technology comes with a built-in and easy-to-use token issuance system accessible to anyone and absolutely permissionless. The built-in token capabilities help to generate dividends, support multi-signature authorizations, limit the token holders, and much more.
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