How to Buy Stellar Lumens (XLM) Cryptocurrency

There are hundreds of cryptocurrencies to invest in, with more are being added all the time. One of the most popular is Stellar Lumens (XLM). It’s an open-source, blockchain-based distribution ledger that stores and transfers money at reduced fees compared to other cryptos.

If you’d like to know how to buy Stellar Lumens (XLM) cryptocurrency, this guide will tell you both how and where you can do it.

Table of Contents
  1. What is Stellar Lumens?
  2. How to Buy Stellar Lumens
    1. Choose a Crypto Exchange or Investment Broker
    2. Select a Digital Wallet 
    3. Fund Your Account
    4. Executing Trades
  3. Where to Buy Stellar Lumens
  4. Coinbase
  5. Kraken
  6. eToro
  7. Webull
  8. SoFi Invest
  9. Bottom Line on Buying Stellar Lumens (XLM)

What is Stellar Lumens?

Stellar Lumens was developed in 2014 as a fork from the Ripple (XRP) cryptocurrency. But unlike many other cryptos, Stellar Lumens was designed for full integration into the global financial system. It was meant to function as a medium of exchange rather than as a standalone currency for investment.

Stellar Lumens has been developed with an open-source codebase, allowing anyone to participate and even change or modify the coding.

Stellar Lumens opened trading at $0.01 in May 2014 and currently trades at around $0.29. The crypto reached a high price of $0.71 in January 2018.

How to Buy Stellar Lumens

Choose a Crypto Exchange or Investment Broker

To trade or hold cryptocurrency, you’ll need to open an account with a crypto exchange or an investment broker that accommodates crypto, specifically Stellar Lumens (be aware that though there are many potential platforms, not all offer Stellar Lumens). We’ll provide a list of several crypto exchanges and investment brokers to choose from in a later section. Also, for more information, feel free to check out our guide to the best crypto sites and exchanges.

Even if your goal is to trade Stellar Lumens, you shouldn’t select an exchange based solely on its ability to support one particular crypto. Since it’s likely you’ll want to trade other cryptocurrencies, pay careful attention to the other options they offer. Though you may start with Stellar Lumens, you’ll likely want to expand into other cryptos as well.

In our list of platforms below, we’ve highlighted the features and benefits of each. Choose the exchange or broker that will be the best fit for your investment preferences and style. You should also closely evaluate what other investments offer. And if you expect to trade any crypto actively, pay close attention to the fee structure of the platforms you are considering.

Select a Digital Wallet 

Since Stellar Lumens, like all crypto, is a digital asset, it will need to be stored digitally. That will usually require a digital wallet. You can purchase crypto on an exchange, but it will need to be held in a digital wallet. When it’s time to sell or transfer the crypto, you’ll do it from the digital wallet.

Some crypto exchanges offer an online digital wallet. You can typically use your own digital wallet and probably should. Though purchasing your own digital wallet will cost some money, it’s a good investment. 

Personal digital wallets are more secure than those offered by crypto exchanges because they’re less likely to be hacked by unintended third parties. They also have the benefit of enabling you to transfer crypto from one exchange to another more easily.

Be aware, however, that if you purchase crypto through an investment broker, you won’t have access to a digital wallet. That’s because while brokers enable you to trade crypto, they don’t allow you to transfer or spend it. Once crypto is purchased with a broker, the only way to retrieve it is to sell it through the same broker.

Digital wallets are available in either hot or cold storage. Hot storage holds your crypto on your computer or mobile device and requires you to connect to the Internet to access your crypto. Cold storage wallets are physical media, like a thumb drive. It’s the most secure form of holding digital assets because you have it in your possession. You can also transfer it between devices, making it totally portable.

Fund Your Account

There are generally two ways to fund a crypto account:

  1. Link a bank account, and transfer funds to your crypto exchange account, or
  2. Transfer crypto from one exchange to another.

A linked bank account has the advantage of giving you the ability to move funds between your crypto account and your bank account.

Be aware that while transferring crypto from one exchange to another is an inexpensive way to move crypto, you can only do it if the crypto you want to transfer to a new exchange supports that particular cryptocurrency.

Executing Trades

This is a straightforward process, much like trading stocks with an investment broker. But be aware that broker assistance, if necessary, may not be available, at least not on crypto exchanges.

The process of both buying and selling crypto takes place entirely online. Whether buying or selling, you can use either a market order or a limit order. A market order is the fastest way to trade because it executes the transaction at the then-current price. With a limit order, you set the trade amount, which means the trade won’t happen until the price of the crypto reaches that limit.

Before making any trades, you’ll need to be sure you have sufficient funds in your account to cover the full purchase amount. If you’re trading on a crypto exchange, you’ll need to store your crypto on a digital wallet.

If you want to sell crypto you already hold, you can transfer it out of your digital wallet onto the exchange. Proceeds can be accepted in traditional currencies, like US dollars, and then used to purchase additional crypto or transferred to your bank account.

Where to Buy Stellar Lumens

As one of the more popular cryptocurrencies, there are several platforms where you can trade Stellar Lumens.

Some are cryptocurrency exchanges, dealing primarily or entirely in cryptos. But there are also diversified investment platforms that allow you to trade Stellar Lumens alongside more conventional assets, like stocks, bonds, and exchange-traded funds.

We are listing five platforms in all; three cryptocurrency exchanges, and two investment brokerages. You can choose the one that works best for you, based on your own investment goals and the features offered by each.

Coinbase

Coinbase is one of the best-known crypto exchanges in the industry. The platform will give you access to trading nearly 70 cryptocurrencies, including Stellar Lumens. Their trading platform is one of the most advanced in the crypto exchange space, and they offer plenty of features, making this an attractive choice.

For example, you can spend against your crypto balance using a Visa debit card. And they offer stablecoin with a value tied to the US dollar, making it easy to transfer your balance to other accounts or convert it directly into currency.

Coinbase also offers Coinbase Earn, where you can earn additional crypto by completing courses related to specific cryptocurrencies. You can also earn additional crypto by crypto staking on the exchange. Crypto staking involves monitoring activity among certain cryptos and earning commissions for your effort.

Coinbase also allows you to trade other digital assets, like non-fungible tokens or NFTs. These are a popular type of digital asset based primarily on digital art. Artists create digital art, which then trades much like cryptocurrencies. Because they have skyrocketed in price recently, NFTs are gaining acceptance as alternative investments.

You can store your cryptos in a digital wallet provided by Coinbase or by using your own digital wallet.

You can open an account with Coinbase and begin investing in Stellar Lumens and other cryptos with as little as $2.

Learn more about Coinbase

Kraken

Kraken is another popular crypto exchange with access to Stellar Lumens and more than 50 other cryptos. And while they don’t offer customer support by phone – a typical limitation among crypto exchanges – they do offer 24/7 live chat support, which is the next best thing.

Much like Coinbase, Kraken also offers you the ability to earn extra income through staking. You can earn rewards of as much as 7% based on the crypto you stake.

But it’s Kraken’s margin trading capability that really stands out, by giving you the ability to buy more crypto than you have cash in your account. In fact, you can leverage crypto purchases up to 5X, which is considerably more than the 2X leverage available on major investment brokers for margin trading on stocks.

Kraken doesn’t offer a digital wallet, so you’ll need to supply your own. But they have no minimum initial investment requirement, and minimum trade amounts are based on specific cryptos. For example, the minimum trade size for Bitcoin is 0.0001 Bitcoin. 

Check out our full Kraken review.

Learn more about Kraken

eToro

eToro offers trading in 17 different cryptocurrencies, including Stellar Lumens. One of the better-established crypto exchanges, it makes its services available in 140 countries around the world. In fact, it also functions as a general investment platform for stocks and other securities, at least outside the US.

What makes eToro a good choice to invest in crypto with is that they offer their CopyTrader feature. That’s a social trading platform where you can copy the trading activities of other participants in the network. That will not only help you to learn how to trade crypto, but it will also keep you on top of current crypto trading patterns.

If you want more direct benefits from copy technology, you can invest in one of their Copy Portfolios. Each one is like a robo-advisor specializing in crypto while copying the trading patterns of the most successful traders on the platform. And if you’re already a successful crypto trader, you can earn additional income by allowing others to copy your activity.

eToro is also excellent for new crypto investors since you can open an account with a virtual portfolio and trade up to $100,000. That will allow you to learn how to trade crypto before committing your own money.

eToro requires a minimum initial investment of $50 to open an account and a minimum of $25 per trade. A digital wallet is offered, but you can also use your own.

Check out our full eToro review.

Learn more about eToro

Webull

Webull is one of two stock brokerages we’ve included because they accommodate crypto trading. Webull offers trading in eight cryptos, including Stellar Lumens. What’s more, you can trade cryptos commission-free. Like other crypto platforms, Webull earns its revenue from spreads on crypto prices.

The big advantage with Webull is that you can trade crypto on the same platform where you invest in stocks, options, and ETFs, all of which can similarly be traded commission-free.

Webull is designed strictly for those who only want to trade cryptos. They don’t offer a digital wallet, nor can you use one of your own. For that reason, crypto purchased on the platform can only be held and sold with Webull. It can’t be transferred to another crypto exchange or spent using a connected debit card.

There is no minimum amount to open an account, but you will need a minimum of $1 to trade cryptos.

Check out our full Webull review.

Learn more about Webull

SoFi Invest

SoFi Invest started as a student loan refinancing provider, but they’ve since branched into nearly every nook and cranny of personal finance. That includes personal loans, home loans, insurance, credit cards, access to financial advisors, and investments.

They offer the ability to engage in self-directed investing, where you can trade stocks, options, and ETFs commission-free. And if you prefer a managed investment option, you can take advantage of SoFi Automated Investing.

SoFi Invest also accommodates trading in cryptocurrencies. You can trade in 20 different cryptos, including Stellar Lumens. They charge a flat fee of up to 1.25% of the total amount of crypto traded.

SoFi Invest is the only provider on this list that offers live customer service by phone. However, like Webull, they don’t offer a digital wallet, nor can you use your own. For that reason, SoFi Invest is suitable only for investors who want to trade crypto, not spend it or transfer it to other accounts.

SoFi Invest has no minimum requirement to open an account, but you will need a minimum of $10 trade crypto.

Learn more about Sofi Invest

Bottom Line on Buying Stellar Lumens (XLM)

Cryptocurrencies like Stellar Lumens have been growing in popularity in recent years. But despite the stunning performance of digital assets, you should understand that cryptocurrency is more of a speculation than an investment. It doesn’t represent an equity stake in a business, nor does it produce dividends or interest income.

When you invest in a cryptocurrency, make sure it’s with money you can afford to lose. It should represent a small corner of a balanced portfolio that includes more traditional investments, like stocks and bonds.

And once you’re ready, choose one of the crypto platforms above – whether it’s a crypto exchange or an investment brokerage – that can best accommodate your own investment needs and preferences.

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About Kevin Mercadante

Since 2009, Kevin Mercadante has been sharing his journey from a washed-up mortgage loan officer emerging from the Financial Meltdown as a contract/self-employed "slash worker" – accountant/blogger/freelance blog writer – on OutofYourRut.com. He offers career strategies, from dealing with under-employment to transitioning into self-employment, and provides "Alt-retirement strategies" for the vast majority who won’t retire to the beach as millionaires.

He also frequently discusses the big-picture trends that are putting the squeeze on the bottom 90%, offering workarounds and expense cutting tips to help readers carve out more money to save in their budgets – a.k.a., breaking the "savings barrier" and transitioning from debtor to saver.

Kevin has a B.S. in Accounting and Finance from Montclair State University.

Opinions expressed here are the author's alone, not those of any bank or financial institution. This content has not been reviewed, approved or otherwise endorsed by any of these entities.

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