Definition of Stellar
Stellar is an open source protocol which is decentralized for the digital currency to the fiat currency. It allows for cross-border transactions between all pairs of currencies. The Stellar development foundation which is a non-profit organization supports the Stellar protocol. The network of the Stellar is based on the blockchain technology and is a publicly distributed ledger. It also allows for the transfer of not only payments but also the transfer of value. The lumens (XLM) is the native digital asset of Stellar. In simple words, it can be said that the Stellar is the network of the payment and the lumens (XLM) is its cryptocurrency.
History of Stellar
Jed McCaleb the co-founder of Ripple in the year 2014 launched Stellar as the network system with Joyce Kim who was a former lawyer. Jed McCaleb initially launched a website which was known as the secret bitcoin project in order to seek the alpha testers. The Stellar was later launched on the payment network which was decentralized and the protocol along with the native currency. When the network was launched, it had Stellar which amounted to 100 billion out of which 25 percent would be given to the non-profit organisations who were working toward financial inclusion. The cryptocurrency which was initially named as the Stellar but was later renamed as the lumens or the XLM.
The features of the Stellar
Below is the list of general characteristics of the cryptocurrency Stellar:
- The Stellar payment network is the open source network which is publicly distributed and is owned by the community.
- It is used to facilitate the cross-asset transaction of the value.
- It cannot handle all the types of software such as the Etherium but it is considered as the best alternative to the Etherium.
- The Stellar can handle the exchanges between different cryptocurrencies and the currencies which are fiat-based. It is similar to the Ripple in this aspect.
- The transaction fees of the lumens (XLM) is really low.
- Any asset which is using the lumens network along with the Stellar network has a fast transaction speed as compared to the Ripple.
- The organization which supports the Stellar network is centralized similar to that of the Ripple. It is designed to handle the cross-platform and the micro-transactions. However, unlike Ripple, the organization which supports Stellar is a non-profit organization and the platform itself is decentralized and open-source.
- The similar traits in the Ripple and the Stellar is due to the fact that the Stellar was initially based on the model and protocol of the Ripple.
- The Stellar and its cryptocurrency the lumens or the XLM is generally in competition with the other cryptocurrencies but they are in direct competition with the ethereum and the Ripple because they are digital partners for businesses and banks.
The uses of the Stellar network
- It can be used to reduce the cost of transactions and get new customers.
- More micropayments can be managed for fewer transaction fees with the help of the Stellar network.
- It also lowers the cost remittances and the transactions are cryptographically secure.
- The real-time settlements in the Stellar network can be made in a short time.
- The Stellar network has an international reach with the help of a single integration and it also offers an automatic exchange of currency.
The major benefits of the Stellar
- The Stellar cryptocurrency is scalable. It offers the best combination of the cost of the transaction, per the second transaction and the average settlement of the huge blockchain network. The recent tests which have been conducted to test the above-mentioned traits reveal that the Stellar network can handle 10000 transactions in one second with 5 seconds of the average settlement time. It is considered great for an on-chain settlement.
- The Stellar is a great cryptocurrency to bring in liquidity. An asset which is liquid can be traded on the Stellar with the use of the Stellar dex.
- The Stellar network has also enabled smart contracting both for the process of development and execution.
- The Stellar network also supports the expansion of the ecosystem. The greatest benefit of the Stellar network is that it has all the tools available in order to support the engagement of the already existing financial institutions.
- The speed of the transaction is really high and low as the cost of transactions.
- The confirmation period of the transaction is as low as 3 to 5 seconds.
The drawbacks of the Stellar network
- The Stellar faces great competition in the cryptocurrency market and it gets quite difficult to hold the ground.
- There is a fixed minimum limit for having the access which requires the user to have at least 20 coins of XLM in their wallet in order for it to work.
- The price follows the Ripple instead of following the bitcoin and hence the Stellar drops with the drop in the XRP.
- It is held for a long-term period and not something which is to be held for a month.
- The Stellar network is not completely decentralized.
The future of the lumens (XLM)
The feature remains constant with all the cryptocurrencies is the volatility. The price of the cryptocurrencies keeps on changing from time to time. Since the Stellar follows the price of the Ripple, it keeps changing with the change in price in the XRP. The Stellar XLM is the sixth largest coin by market capitalization. The Stellar is among those coins which have better weekly placement and recovery from a drop.
Short Summary
What is Stellar?
Introduction of Stellar
Stellar is an open source protocol which is decentralized for the digital currency to the fiat currency. It allows for the cross-border transaction between all pairs of currencies. The network of the Stellar is based on the blockchain technology and is a publicly distributed ledger. Jed McCaleb the co-founder of Ripple in the year 2014 launched Stellar as the network system with Joyce Kim who was a former lawyer. Jed McCaleb initially launched a website which was known as the secret bitcoin project in order to seek the alpha testers. The Stellar was later launched on the payment network which was decentralized and the protocol along with the native currency.
The Stellar cryptocurrency is scalable. It offers the best combination of the cost of the transaction, per the second transaction and the average settlement of the huge blockchain network. The recent tests which have been conducted to test the above-mentioned traits reveal that the Stellar network can handle 10000 transactions in one second with 5 seconds of the average settlement time. It is considered great for an on-chain settlement.
The Stellar faces great competition in the cryptocurrency market and it gets quite difficult to hold the ground. There is a minimum limit for having the access which requires the user to have at least 20 coins of XLM in their wallet in order for it to work. The price follows the Ripple instead of following the bitcoin and hence the Stellar drops with the drop in the XRP. It is held for a long-term period and not something which is to be held for a month The Stellar network is not completely decentralized.
The feature remains constant with all the cryptocurrencies is the volatility. The price of the cryptocurrencies keeps on changing from time to time. Since the Stellar follows the price of the Ripple, it keeps changing with the change in price in the XRP. The Stellar XLM is the sixth largest coin by market capitalization. The Stellar is among those coins which have better weekly placement and recovery from a drop.