How to Buy Stellar Lumens (XLM) Using Cash App

Stellar Rocket
Stellar Rocket

Stellar is an awesome platform that connects banks, payments systems, and people. Unfortunately, it’s one platform whose digital currency is not currently offered on Coinbase. While Coinbase is exploring the inclusion of Stellar Lumens (XLM) on its platform, we must use other methods to acquire lumens.

Coinbase is by far the most popular cryptocurrency exchanges in the US. And while you can acquire bitcoin on Coinbase and convert it to lumens elsewhere, I find the process slow and expensive.

That’s where Cash App comes in.

Cash App is an awesome onramp to purchase bitcoin. With a $10,000 weekly purchase limit, you can buy bitcoin on Cash App at a competitive exchange rate with no conversion fees. In addition, transferring funds from your bank account to Cash App is instant so there’s no waiting for funds to clear your account. Lastly, once you purchase bitcoin on Cash App, it can be transferred to any external wallet.

Cash App BTC to XLM conversion process

Here’s my Bitcoin to Lumens conversion process…

Buy Bitcoin via Cash App → Transfer Bitcoin to Stellar Anchor & Wallet → Convert Bitcoin to Lumens

Buy Bitcoin via Cash App

Purchasing bitcoin on Cash App is straight forward:

  1. Add Cash to your account
  2. From Bitcoin screen, tap on Buy.
  3. Enter the desired amount and tap Buy again.
  4. At the confirmation screen, double check the amount and exchange rate and tap Confirm.

Be sure to take note of the BTC exchange rate as you will use that during the conversion process.

Transfer Bitcoin to Stellar Anchor & Wallet

There’s a few prerequisites as you will need an existing account with an established BTC trust line on the Stellar network. For this, I recommend using StellarX as a conduit to Stellar’s decentralized exchange (also known as SDEX).

Here’s a few StellarX articles to help get you started (skip if you have an existing account):

Link your Stellar account to a trusted BTC anchor like Papaya Anchor:

  1. From Paypaya Anchor site, click on Deposit.
  2. Click on BTC.
  3. Confirm you clicked on BTC.
  4. Copy and paste your public Stellar address into Stellar address field.
  5. Click Get BTC Address.

If all goes well, the Papaya Anchor web site will give you a BTC address. Copy and paste this BTC address to a trusted BTC blockchain explorer like Blockchain to generate a QR code.

From Cash App’s Bitcoin screen:

Cash App Bitcoin Confirmation
Cash App Bitcoin Confirmation
  1. Tap on Withdraw Bitcoin.
  2. Using the slider, determine how much BTC to withdraw to your Stellar account.
  3. Take a photo of the QR code.
  4. Triple check the amount and BTC address given by Papaya Anchor.
  5. Confirm.

Grab a cup of coffee and wait for the bitcoin network to confirm your transaction. It can take upwards of 30 mins (or longer) depending how busy the network is. After the bitcoin transaction is confirmed, Papaya Anchor will credit your Stellar account with BTC.

Convert Bitcoins to Lumens

This is the fun part because you get to trade your bitcoins for lumens on Stellar’s decentralized exchange. For free.

Calculate your BTC/XLM sell price:

BTC ÷ XLM = BTC/XLM Unit Price
Example: $3,726.22 BTC ÷ 0.11 XLM = 33,874.72727 BTC/XLM Unit Price

Using StellarX:

StellarX Buy/Sell Order Screen
StellarX Buy/Sell Order Screen
  1. From Wallets tab, click on Bitcoin (apay.io).
  2. Click on Sell tab.
  3. Enter Unit Price from above calculation.
  4. Click on Sell Max (or enter desired quantity).
  5. Confirm sell unit price, quantity, and total.
  6. Click Sell BTC.

Once your order is submitted to the Stellar’s distributed exchange, click on the Activity tab to see the progress of your order. To adjust your order, you will need to cancel your existing order prior to submitting a revised order.

Final Thoughts

Here are some final thoughts…

  • The final USD to XLM exchange rate is really dependent on the ability to sell BTC to XLM, so you’ll need to be confident you can execute on the BTC/XLM exchange rate.
  • The volume on the exchange will vary, which will affect how speed your order is executed.
  • There are other Stellar BTC anchors such as NaoBTC, Stellarport, and Interstellar that you can use besides apay.io I mentioned above, but I am not familiar with their deposit/withdrawal methods.
  • While Cash App does not charge any fees to buy Bitcoin, Square (owner of Cash App) is profiting ~$500,000/quarter from its bitcoin operation. So perhaps they are marking up the price of Bitcoin/USD or profiting from the buy/ask spread.
  • This is by far my favorite method as the USD to XLM exchange rate is good.

If you have any questions, reach out to me on Keybase or Twitter. Good luck!