Why is the price of XLM still falling despite positive data from the Stellar Network?

Stellar Network, a blockchain platform designed for fast and low-cost cross-border transactions, is showing positive signals despite the recent correction of the XLM token.

What are these signals, and are they strong enough to withstand the increased selling pressure in the market at the end of September?

Total locked value reaches a record high in September

The Total Value Locked (TVL) of Stellar reached a record high in September, with over 400 million XLM locked in protocols. According to data from DeFiLlama, this number has doubled compared to the previous quarter, reflecting the growing confidence of the community in locking XLM within the Stellar ecosystem.

Total value locked of Stellar | Source: DefiLlamaCalculating TVL in XLM is considered more reliable than calculating in USD, as the price of XLM in USD often fluctuates significantly due to market factors, which can distort the actual picture of locked assets.

In fact, although the price of XLM has dropped by more than 30% since the beginning of the quarter, the TVL measured in USD has remained stable at around 140 million USD. This indicates that the amount of XLM locked in protocols continues to increase rather than decrease.

TVL calculated in XLM focuses on intrinsic value, accurately measuring the assets that users commit for staking, lending, or providing liquidity. The leading protocols attracting capital include Blend, Aquarius Stellar, and Stellar DEX.

However, objectively, the TVL of Stellar is still modest compared to other ecosystems, where TVL can reach billions of USD.

Smart contract activities surged in September

Another highlight of the Stellar network is the strong increase in smart contract activity. According to Dune Analytics, the number of smart contracts executed has skyrocketed in September, with over 1 million contract calls per day.

This index measures the average number of successful smart contract calls per day, helping to assess the trend of acceptance and support decision-making regarding resource allocation as well as platform development.

Stellar's daily smart contracts | Source: DuneData shows higher trading volumes, rich creativity, and practical applications from developers. Typical examples include contracts related to payments, DeFi, and integration with traditional financial systems.

This increase brings significant implications, proving that Stellar is moving beyond the testing phase towards real-world adoption. This also reinforces Stellar's position as a reliable platform for decentralized financial services, attracting more capital and partnerships.

The interest of institutions increased in September

Alongside positive on-chain data, Stellar has also expanded its presence in the institutional space in September. Mercado Bitcoin, the largest digital asset investment platform in Latin America, recently announced the issuance of 200 million USD of tokenized financial assets (stocks and bonds) on the Stellar network.

RedSwan Digital Real Estate has also tokenized 100 million USD in commercial real estate (luxury apartments and hotels) on the Stellar blockchain.

Moreover, PayPal has officially integrated the stablecoin PYUSD on Stellar, allowing for fast transactions and low costs.

In particular, the Hashdex Nasdaq Crypto Index ETF ( code: NCIQ) has filed an application with the SEC to include NCIQ. This fund includes the top five cryptocurrencies: Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL), and Stellar (XLM).

This move is very promising, especially after the SEC relaxed the listing standards for cryptocurrency ETF funds and officially approved the Grayscale Digital Large Cap Fund (GDLC).

Despite these positive signals, the price of XLM continues to be heavily affected by bearish market sentiment at the end of September.

XLM price chart | Source: CoinphotonAs trading fear subsides, the solid platforms of Stellar may have the opportunity to showcase their value.

Mr. Teacher