eToro
By eToro
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Trading EOS/XLM: A Deeper Understanding of the Blockchain

The EOS/XLM pair matches up EOS with XLM. Lumens (XLM) is a native token of the Stellar blockchain network. Stellar Lumens is a crypto platform that empowers the secure transfer of money at a low cost, with the goal of making financial transactions easier and helping to fight poverty by giving wide access to low cost financial services. Stellar Lumens was first introduced in 2014 before undergoing a major upgrade in 2015. A pair of pure cryptocurrencies will usually experience a much higher level of volatility than a pair where one or both currencies are fiats.

65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

This is not investment advice

What is EOS?

EOS is a project of a blockchain development company called Block.one, headed by Dan Larimer, who has worked on popular projects such as Bitshares and Steem. EOS’ main  purpose is to fund EOS.io, a tool that anyone with programming skills can use to create decentralised applications, along with smart contracts on a single web interface, which is simple and friendly enough to be used by as many people as possible. EOS software is regarded as a “tool” to make it easier for people to work with the blockchain, just as the Windows operating system works with a computer. It provides a simple interface and a way to take advantage of this important technological development.

What is Stellar Coin (XLM)?

The company and its blockchain are called ‘Stellar,’ the tokens are called Lumens or XLM. Lumens (XLM) is the digital currency that the Stellar network applies. Stellar is the Blockchain platform developed to raise capital for global transaction development projects, particularly banks with high security and extremely low transaction costs. Stellar is built on the Stellar Consensus Protocol.

XLM’s  many advantages include that transactions with this digital currency are rapid and low cost. In addition, traders are equipped with a package of friendly software to connect to the Stellar network. Otherwise, Stellar requires traders to have a specific minimum amount of XLM in order to trade.

EOS and XLM — Main Differences

There’s not much difference between these two cryptocurrencies from the perspective of trading and investing, as both are created based on the blockchain technology with many useful potential applications.

However, both EOS and XLM value can be affected by any negative news about a specific coin. The news may lead to disastrous sell-off and change the value of the cryptocurrency significantly.

EOS, greatly expected by cryptocurrency traders to prove to be a force against the denomination of Bitcoin and Ethereum, experienced a honeymoon until May 2018. The EOS/USD exchange rate advanced  to nearly US$22 for one EOS, at its high. The BitMEX platform, which provided EOS futures contracts in the past, eventually removed them to provide BTC, BCH, ETH and other contracts. However, under huge pressure from the rise of EOS, the floor announced that they were ready to relaunch them in June of that year. It seemed like nothing could stop EOS until the biggest enemy of cryptocurrencies showed up — volatility. The value of EOS then started to decrease. .

Given their relatively short lifespan so far, EOS and XLM still face hesitation from the majority of the market and can expect many fluctuations ahead before they can gain enough trust as their predecessors Bitcoin and Ethereum did. Trading EOS/XLM will surely require a deep understanding of blockchain technology in general and cryptocurrencies in particular.

eToro is a multi-asset platform which offers both investing in stocks and cryptocurrencies, as well as trading CFD assets.

Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Cryptocurrencies can fluctuate widely in price and are, therefore, not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework. Past performance is not an indication of future results. This is not investment advice. Your capital is at risk

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