XLM Plunges 23% Amid Market Volatility Growing Network Activity and Stablecoin Momentum Fuel Rebound Hopes

Stellar Lumens (XLM) experienced a significant price drop on July 24, falling over 23% to $0.400 from this month’s high of $0.5200. The decline aligned with broader market volatility, including a sharp sell-off in Ripple’s XRP token following a large insider sale [1]. Despite the downturn, on-chain metrics and technical indicators suggest the selloff may be temporary, with potential for a rebound driven by growing network activity, stablecoin adoption, and favorable chart patterns.

Stellar’s blockchain has shown robust growth in transaction volume and user engagement. Nansen data reveals a 22% weekly increase in transactions, reaching 2.93 million—surpassing Ethereum’s 10 million—while active addresses surged 16% to 208,000. Network fees, typically low for Stellar, spiked by 99% to $73,000, underscoring heightened usage [1]. Analysts attribute this to the platform’s focus on cross-border payments and low-cost transactions, which position it as a competitor to larger blockchains in specific use cases.

Stablecoin activity has also accelerated, with Stellar’s stablecoin supply rising 15% in 30 days to $184 million and transaction volume jumping 40% to $1.8 billion. The number of stablecoin addresses on the network increased by 33% to 260,000, reflecting growing institutional and retail interest in pegged assets [1]. This trend is further supported by regulatory developments, such as the recent U.S. passage of the GENIUS Act, which could expand Stellar’s role in processing USD Coin (USDC), a major stablecoin.

Technically, XLM has formed a doji candlestick pattern, a potential reversal signal characterized by a small body and elongated shadows indicating indecision between buyers and sellers. The price has maintained support above the 50-day and 20-day moving averages, suggesting a completion of a mean reversion phase. Traders are monitoring the $0.5200 level—a 20% target from current prices—as a key resistance to gauge further upside potential [1].

The convergence of increased network participation, stablecoin momentum, and technical support positions Stellar for a possible rebound. However, the broader crypto market’s volatility and macroeconomic factors remain critical risks. Market participants are advised to monitor on-chain activity and regulatory updates for confirmation of a sustained recovery.

Source: [1] [XLM price has crashed: 3 reasons Stellar may rebound] [https://coinmarketcap.com/community/articles/6882711062fc924b0b927c8d/]