Stellar Lumens XLM surges 72% as futures open interest hits $345 million

Stellar Lumens token (XLM) has seen a significant price surge this week, reaching its highest level since February. The cryptocurrency's value has been on an upward trajectory since June 25, when it hit a low of $0.2187, and has since rebounded by over 72%. This surge coincides with a notable increase in futures open interest, which soared to $345 million, the highest level since January. This increase in open interest indicates heightened liquidity and demand for XLM.

The price surge of XLM can also be attributed to updates in the DeFi Llama platform, which included the Franklin Onchain US Government Money Fund in its ecosystem stablecoins calculation. This inclusion led to a record high stablecoin supply of $627 million, although excluding these assets, Stellar's stablecoin supply stands at $181 million, primarily consisting of USD Coins. Additionally, the number of active addresses, transactions, and fees on the Stellar network have increased, with active addresses jumping by 13% and transactions rising by 16% in the last seven days.

Technical analysis of XLM's price movement reveals the formation of a double bottom pattern on the daily chart. This pattern, characterized by two consecutive lows followed by a rise, is a strong indicator of future price increases. The lower side of the pattern was at $0.2180, with the neckline at $0.3331, giving it a depth of $0.115. The price target established by this pattern is $0.45, which is approximately 20% above the current level and a few points above the 38.2% Fibonacci Retracement level. Another potential scenario is that XLM's price could drop and retest the neckline at $0.3331 before resuming its uptrend.

The recent surge in XLM's price has also been accompanied by a rise in the total value locked (TVL) in the Stellar network, which hit $97.7 million. This increase in TVL is a strong indicator of growing demand for XLM, as more users are locking up their tokens to participate in the network's various decentralized finance (DeFi) protocols. The upcoming upgrades to the Stellar network, coupled with the growing demand, have helped fuel the recent surge in XLM's price. Analysts believe that the cryptocurrency could continue to climb in the coming weeks and months, although the highly volatile nature of the cryptocurrency market means that investors should conduct their own research before making any investment decisions.