Stellar Lumens (XLM) is one of the most popular cryptocurrencies in the world. It allows people to send money overseas in an instant, and it has backing from some big tech firms. Here, we talk about XLM, and everything you need to know about it.
What is Stellar?
Stellar is one of the many blockchains available today. It’s one of the oldest and most popular blockchain platforms, and it focuses on making it easy for people to send money abroad.
Sounds like XRP? Well, there’s a reason for that.
Stellar launched in 2014 as a project from the Stellar Development Foundation – a blockchain development company. Interestingly, the company started as a project by Jed McCaleb – one of the founders of Ripple (XRP). McCaleb left Ripple in 2014 because he reportedly had disagreements with his co-founders there. He decided to do his own thing, and that’s the origin of Stellar.
Today, the Stellar Development Foundation is one of the biggest blockchain companies. It has gotten investments from several big names in tech, including Google and IBM. The company also has some pretty high-profile partners, too. These include Flutterwave and MoneyGram.
How Does Stellar Work?
Stellar is a blockchain platform. Like many others, it allows users to send money easily and quickly. There are people (called “nodes”) on the network who verify and confirm transactions, and they get rewards in its native token – Lumens (XLM).
XLM: Should I Really Care?
Like we said, XLM is the native token for this blockchain. It mostly helps users to pay transaction fees on the blockchain. But, it can also act as a middle currency. This means that when people make payments on Stellar, the blockchain uses XLM to settle these payments instantly.
Imagine you send dollars from your home in New York to someone in Canada using the Stellar blockchain. Stellar immediately converts the dollars to XLM, then the recipient can get the money in Canadian dollars instantly. The entire conversion takes just a few seconds, so Stellar and XLM ensure that anyone can send and receive money anywhere in the world.
When Stellar first launched, its native tokens were called “Stellars.” But, the company changed the token’s name to “Lumens.” So, while Stellar is the platform, Lumens are the currency.
How Is Stellar Different from Ripple?
People who have used Stellar and Ripple have pointed out that both platforms are very identical. They use similar blockchain codes, have similar goals, and don’t have mining processes.
Like you’d expect, these similarities are because of McCaleb. He built the Stellar platform based on his Ripple experience.
So, is Stellar better than Ripple? Well, it depends. While both platforms do the same thing, they don’t have the same market.
Ripple is more focused on banks and big companies that want to make international transactions quickly. On the other hand, Stellar was built to meet the average person’s needs. Of course, anyone can use Stellar or Ripple to send money in an instant. It’s all a matter of your preference.