The host of the crypto channel Coin Bureau reveals its outlook for Stellar (XLM) next year after the lackluster performance of the XRP competitor in 2021.
In a new video, the pseudonymous analyst Guy tells his 1.78 million YouTube subscribers that while the price of Stellar (XLM) has doubled this year, the profits of the altcoin compared to the performance of other crypto assets are “peanuts ” are.
According to Guy, Stellar’s poor price performance can be attributed to a primary reason: selling pressures, particularly from the Stellar Development Foundation (SDF), a non-profit organization dedicated to developing and growing the Stellar network.
“The foundation received only $ 3 million when it was set up. To the best of my knowledge, it has not received any additional funding since then. This means that the foundation relied on the sale of XLM to pay for their expenses and fund the expansion of Stellar’s ecosystem, and again, this is not speculation. The Foundation’s XLM spending is clearly listed on their mandate page and I applaud them for their transparency.
The latest numbers suggest the foundation has spent over 5 billion of its 30 billion XLM to date, and the reversing machine shows about 3 billion of those XLMs were spent in the last year.
In addition, a paragraph at the end of the mandate states: “As we said when we first announced this framework in November 2019, we intend to use or distribute most of these lumens within 10 years, ideally sooner.” In other words, the pressure to sell won’t stop anytime soon. “
Guy also says XLM doesn’t seem to have many demand drivers besides ongoing selling pressure. Institutional investors may shy away from the crypto asset due to the regulatory uncertainty surrounding XRP, the crypto analyst said.
However, Guy says the favorable results of SDF’s partnership with MoneyGram could allow XLM to return to its January 3, 2018 record high of $ 0.87.
In October, the remittance giant announced that it was integrating the Stellar blockchain into its network to enable cash funding and local currency withdrawals for consumers with Stellar USD Coin (USDC).
“The only demand for XLM is coming from the institutions the Stellar Development Foundation has worked with, and these partnerships are just beginning to take shape. On the plus side, this paints a pretty optimistic picture for XLM in 2022, and I could see XLM retesting its early 2018 highs if the MoneyGram partnership keeps its promises. Stellar also has no shortage of upcoming milestones that could pique the interest of both retailers and institutions. “
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