Stellar Price Today - XLM Price Chart & Market Cap | CoinCodex (2024)

Stellar is an open-source, decentralized network for storing and moving assets. The network is powered by the Stellar Consensus Protocol, developed specifically for Stellar, and has a native asset called Stellar Lumens (XLM).

Founded in 2014, Stellar Development Foundation is a non-profit organization that focuses on the development of the Stellar network. It was founded by Jed McCaleb, a prominent figure in the crypto world, also one of the co-founders of Ripple.

After having issues with Ripple’s for-profit nature, he decided to join forces with former lawyer Joyce Kim and create a new product meant to "promote global financial access, literacy, and inclusion, and create an open and affordable financial system where people of all income levels can access simple-to-use, secure, and low cost financial services."

The network has the ability to facilitate the exchange of different digital assets as it features a built-in Decentralized Exchange (DEX). This is done by having a token representing every asset on the network. These tokens are exchanged using the best possible exchange rate available, automatically.

Additionally, any asset can be tokenized, not just fiat currencies. That includes gold, old, shares, any other type of asset.

This works by having a large number of “Anchors”. These are organizations (often banks), whose job is to bridge the difference between the Stellar network and the traditional banking system. This is often done by managing and backing up specific tokens on the network. Anchors are needed to comply with several strict Stellar requirements, meant to promote honesty and integrity. One of the requirements is to have a 1:1 reserve for issued tokens, on an audited bank account.

Stellar’s main function is to provide easy and fast money transfers all around the world. Here is an example of how Stellar makes this easier.

A person from Russia wants to send some money to a friend in Mexico. Russians use ruble, while Mexicans use peso. Let’s say they want to use Paypal to transfer the money.

First, the Russian has to change ruble to USD or EUR and send it to Paypal, then send it to their friends Paypal and then the Mexican needs to change from USD or EUR to their local currency and then send it to their local bank. It is easy to notice that there are a number of fees present here, as well as some waiting time, from a few hours to days.

Stellar makes this much easier as it has many fiat currencies integrated into the network as tokens. This means that it is possible to send ruble and receive peso, while the network does the exchange automatically, using the best provided exchange rates available.

Some exchanges offer a direct XLM/fiat par, however, it is always possible to use BTC as an exchange mediator. It is also possible to find someone in person to trade with, however, this usually takes more time.

Apart from that, taking part in network operations can result in additional profit. Understanding how nodes work and how to operate them is not straightforward and usually requires some form of education.

Stellar uses industry-standard public-key cryptography tools and techniques, which means the code is well tested and verified. The transactions are public by default, meaning any funds can be audited.

In order to override the network, more than 51% of nodes are required to misbehave, which is extremely difficult to achieve due to Stellars node loyalty record, which incentivizes good behavior.

Additionally, users can choose their validators, which brings a lot of control to the user, allowing for a more reliable service.

Stellar uses a protocol specifically designed for the network itself, which brings a lot to the table. Extremely high speeds with low fees make it excellent for what it was designed for, being a mediator between other currencies and assets.

Developers also have two different incentive programs to push their community contribution. Users who come up with innovative solutions for issues in the network are awarded with up to 2 million XLM.

Generally, Stellar has a public blockchain where the transaction information is available. All the information is available here.

However, Stellar has recently released the Starlight feature which allows two users to trade between each other using a private trading channel. These transactions are validated by the network, however, no information is posted on the public ledger.

The Stellar blockchain is very cheap to use. Stellar transactions have a default fee of just 100 stroops, or 0.00001 XLM. This fee exists solely to prevent DDos attacks.

Additionally, Stellar should be able to support 3,000 transactions per second, which is incredibly high for blockchain technology. Transaction times are estimated to 3-5 seconds.