Here’s Why XRP Leads and XLM Follows

In the world of cryptocurrencies, XRP et XLM share a unique relationship. Their history is intertwined, their technology has notable similarities, and their market dynamics often seem to mirror each other. Recently, the rise in price XRPfueled by developments in the SEC lawsuit, has once again demonstrated the ripple effect it has on XLMwhich followed with its own remarkable price rise.

Relationship between XRP and XLM from common origins

Both XRP (Ripple) and XLM (Stellar) were influenced by the vision of Jed McCalebwho co-founded Ripple in 2012 before leaving to establish Stellar in 2014. Although XRP and XLM share technical similarities and focus on revolutionizing financial systems, their goals differ:

• XRP : Aims to streamline cross-border payments for financial institutions and replace outdated systems like SWIFT. Ripple Labs has positioned XRP as a tool for large banks and corporations.
• XLM : Focuses on financial inclusion, aiming to empower underbanked populations and small businesses. Stellar Development Foundation, the nonprofit organization behind XLM, emphasizes peer-to-peer transactions and accessibility.

This mission divergence has helped the two cryptocurrencies carve out distinct niches, but their intertwined origins and parallel goals have kept their trajectories somewhat linked.

Comparison between XRP and XLM: Similarities and differences

Despite their differences, XLM has often been seen as “following in the footsteps of XRP.” This perception stems from their shared history and similar goals in the cross-border payments revolution. However, their paths diverge in several key ways. Let’s break them down similarities and differences :

Similarities

1. Shared vision : Both XRP and XLM aim to modernize cross-border payments, focusing on speed and cost efficiency.
2. Technology : Each uses a consensus protocol rather than energy-intensive mechanisms like proof of work, allowing for faster transactions.
3. Historical highs : XRP and XLM reached their ATHs on the same day—January 4, 2018—highlighting the market’s tendency to herd these assets into sentiment and movement.
4. Ripple effect : XLM often reflects market movements of XRP, as seen in today’s rise following developments related to Ripple’s SEC.

Differences

1. Target audience : XRP mainly serves financial institutions such as banks and corporations, while XLM focuses on individual users and small businesseswith a focus on financial inclusion.
2. Governance : XRP is closely associated with Ripple Labsa for-profit entity, while XLM is managed by the Stellar Development Foundation (SDF)a non-profit organization.
3. Use cases : XRP facilitates large-scale institutional transactions, while XLM supports peer-to-peer payments and microtransactions, often in underserved regions.
4. Focus on adoption : Ripple pursues partnerships with large financial institutions, while Stellar collaborates with organizations like MoneyGram et IBM to promote grassroots adoption.

This comparison between XRP and XLM highlights how the two cryptocurrencies, despite their intertwined origins, have evolved as separate entities. Yet, as today’s price hike demonstrates, XLM continues to echo XRP’s market movementsreinforcing the idea that Stellar is often “following in the footsteps of XRP” while carving out its own unique niche.

Today’s rise in XRP and the reflection of XLM

The recent XRP price rise is the result of positive news from Ripple’s ongoing legal battle with the SEC. The market reacted strongly to Ripple’s partial victory earlier in 2024, and now with the SEC appeal making headlines, XRP has surged again. This had a notable reflective impact on XLMwhich increased by 9% in the last 24 hours.

Here is an overview of the XLM performance indicators :

• Market capitalization : Reached $14.16 billionpropelling Stellar to the 12e place in the ranking of cryptos, surpassing Toncoin et SUI.
• 24 hour volume : Recorded at an impressive $1.4 billiona 110% increasehighlighting renewed market interest.
• Intraday High : Reached 0,4798 $still down 50.68% from its all-time high (ATH) of 0,9381 $reached the January 4, 2018—the same day XRP reached its ATH.

These parallels further reinforce the narrative that XLM often follows in the footsteps of XRP, both in market trends and all-time highs.

Outlook for XLM price

The rise in XLM price, while exciting, highlights its long-term challenge: breaking free from XRP’s shadow and establishing itself as an independent powerhouse in the crypto space. Stellar’s focus on financial inclusiveness and partnerships with entities like IBM et MoneyGram could help it forge a unique identity.

However, as today’s market movements demonstrate, XRP’s legal victories and market performance remain a key catalyst for XLM. Investors will be watching closely to see if XLM can maintain its growth trajectory and possibly surpass its previous ATH as the broader crypto market evolves.