Stellar Coin (XLM) – Ripple’s Main Competition

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What is the Stellar Coin?

Founded in 2014 by Jed McCaleb, stellar is a not-for-profit open source protocol used for the exchange of value or money. Stellar can also be said to be a decentralized open source blockchain that exists primarily to facilitate the cross-asset transfer of values and payments. The stellar coin wants to offer an equal and easy banking method to everyone. It seeks to be a middleman, agent or intermediary between banks, transactions, and people.

Nonprofit organizations and businesses are integrating Stellar networks into their transaction systems. Oradian, a cloud-based banking company plans to use the Stellar network to connect microfinance institutions in Nigeria. Praekelt Foundation is also integrating Stellar networks to their messaging app “Vumi”. This integration of stellar network into Vumi is done to help girls in sub-Saharan Africa save money on airtime.

Stellar’s desire to ensure a free and fast transaction and payment moved them to sign a partnership with IBM in 2017, this partnership will see both companies seek for ways, techniques, and technology to increase global payment speed.

The mission of the stellar coin is to create a global platform that connects banks, payments systems and people at the same time seeking out for new techniques, ideas, and technology to ensure a faster and reliable moving of money at almost zero cost to the involved parties.

Like NEO, Stellar has its token called “Lumen”. Lumens have been described as native assets of Stellar. Lumens are digital tokens designed by Stellar to help terminate the various incompetence in transactions between financial institutions (banks) and customers (people).

As of January 2018, Stellar Lumen had a total capital market value of $6 billion making it one of the top 10 largest cryptocurrencies in the world in terms of market value.


Main Features of Stellar

In the course of this article, we will discuss the major features of Stellar Lumen. The features are:

  • Money Transfers: Stellar aims at becoming a global platform that ensures that there is a reliable and quicker transfer of values between different blockchains. For us to fully understand what this feature entails, there is a need for an illustration. Let’s say you want to transfer $100 dollar to your cousin who’s on vacation in China. Your cousin wants the money in Chinese Yuan, all you have to do is purchase 20 Lumen XLM (valued at $0.38), this XLM gives you access to the Stellar network. Once you have been granted access to the network all you have to do is deposit your $100 (referred to as Credit) into the network. This credit will be in your online account, the stellar network will convert your $100 dollar to Chinese Yuan and you can send to your cousin at the lowest possible cost. 1 XLM coin valued at $0.38 can cover over 10,000 transactions.
  • Forex Platform: Aside money transfers, Stellar can be used for forex trading. The stellar network provides a platform that connects individuals trying to trade currencies. For example, if two different people need to exchange a British Pound for a Dollar and A Dollar for Pounds, Stellar network affords them the opportunity to trade their Pound for XLM and Dollar for XLM. After exchanging these flat currencies for XLM coins, they can convert them to any currency of their choice on the stellar network. Stellar networks can also be used to connect multiple transactions.
  • While making money transfers faster and more reliable, the Stellar networks also perform micro transactions on the blockchain.
  • Records of all accounts on the Stellar network are stored in a database called “Ledger“.
  • An important feature of Stellar is its nonprofit stand.
  • Stellar Lumen supply increases at 1% each year.


Difference between Stellar and other Cryptocurrencies

  • Since its inception, Stellar has always been compared to Ripple which like Stellar is interested in making transfers.
  • A distinct feature that set Stellar apart from any other cryptocurrency is its nonprofit nature.
  • Unlike other cryptocurrencies, Stellar rewards third-party developers who create useful technologies on the stellar network.
  • Unlike its main rival “Ripple” which aims at building partnerships with big brands, Stellar is interested in smaller money transfer operators.

How to use Stellar

To access a stellar network all you have to do is create an account. After creating an account you can send and receive money. Access to Stellar networks is free. The network allows for modifications. Lumens can be bought in various blockchains. There a number of wallets that support Lumens, there is desktop and mobile wallets that can be downloaded.


  • With as low as 1 XLM valued at $0.38 over 10,000 transactions can be made.
  • The partnership with IBM in 2017 has helped Stellar Network design a technique that ensures that transactions done on the Stellar network are quicker and more reliable.
  • Transactions made on Stellar network take an average of 2-5 seconds to go through.
  • Stellar acts as a bridging currency. It also connects traders. For example, if you have Dollars you need to exchange, the stellar network connects you with another individual who is willing to make the exchange with you.
  • Unlike other cryptocurrencies, Stellar does not mine. At its launch, there have been over 100 billion Lumens in existence.
  • Stellar networks assist in facilitating transactions between any currency, token or asset.
  • Studies have shown that Stellar has an annual inflation of $1 yearly.
  • Financial experts have speculated that the market capital value of Stellar would increase because of its transaction speed and user-friendly features.
  • Lumen owners have the right to vote as to where the almost zero transaction fees should go to.
  • Stellar networks are fast and scalable.


  • Stellar has about 18 million tokens in circulation and a total of over 100 billion tokens. Experts fear that at this rate, there are about 85 billion tokens which could devalue the current tokens in circulation.
  • Stellar Lumens which are used to make transactions are difficult to buy.
  • Like flat money, Stellar Lumen has the danger of losing it’s worth.


Useful Links



Twitter: @stellarorg


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