Three Key Factors That Could Propel Stellar (XLM) to New Highs

Stellar (XLM) has regained the spotlight after demonstrating strong bullish momentum driven by three major factors: a surge in derivatives interest, a significant network upgrade, and solid on-chain fundamentals. This combination underscores the potential for a price breakout in the market.

1. Surge in Open Interest & Whale Activity Strengthens Sentiment

The Stellar derivatives market has recorded an Open Interest (OI) of US$602 million, indicating substantial capital inflows from institutional players and whales. In the past 24 hours, OI jumped by 17%, accompanied by a positive funding rate (0.0327%), signaling a dominance of long positions and short liquidations.

Implication: This spike in liquidity and speculation is creating significant buying pressure, opening the door for a potential breakout above the psychological level of US$0.50.

2. Network Upgrade: Protocol 23 & Soroban Smart Contracts

According to FastBull, Stellar is implementing Protocol 23, which introduces parallel execution of Soroban Smart Contracts and the deployment of CAP‑67 for more efficient asset transitions.

This upgrade has had an immediate impact on price action, with a 75% surge in one week and an 86% rally over the past two weeks, coinciding with increased network utilization.

Implication: These feature enhancements strengthen developer adoption, expand the ecosystem, and enhance Stellar’s long-term utility.

3. Strengthening On-Chain Fundamentals: TVL & Stablecoin Dominance

Data from FxStreet shows Stellar’s Total Value Locked (TVL) has reached US$97.7 million, marking the highest level in its ecosystem’s history.
Additionally, the stablecoin market capitalization on the network has soared to US$630.9 million, reflecting higher liquidity and robust daily transaction activity.

Implication: The surge in TVL and stablecoin dominance highlights the growth of Stellar’s DeFi sector, laying a strong fundamental foundation for future price appreciation.

With a combination of heightened derivatives interest, strategic network upgrades, and solid on-chain fundamentals, Stellar is on track to sustain its rally. If this momentum continues, XLM could break through the psychological level of US$0.50 in the near term.