Over the years, tons of cryptocurrencies have been developed to overcome the problems that their predecessors attempted to solve. One of those is solving the issues presented by cross-border transactions such as high fees and prolonged transaction time.
Stellar is one of those cryptocurrencies that are aiming to solve issues that were left by its predecessors. Currently, it is one of the most trusted cryptocurrencies in the world of digital assets.
What is Stellar?
Stellar cryptocurrency is an open-source ledger where people can make transactions anywhere around the globe. Stellar is developed by Stellar Development Foundation with the goal of transferring money efficiently across borders. It was founded in 2015 by Jed McCaleb, an American programmer and entrepreneur who created Mt. Gox Bitcoin exchange and P2P file-sharing network eDonkey.
Like other cryptocurrencies, Stellar is not backed by central banks and operates using blockchain technology to record its transactions. It is designed to become the bridge of financial systems so money can flow on a single network.
Stellar provides companies and individuals an opportunity to transfer money at cheaper fees. It’s safe and fast with only a 5-second transaction time so users don’t have to wait a few days for the transaction to be completed.
Stellar cryptocurrency has a native token called Lumen or XLM that users can acquire by converting any fiat currency to XLM on an exchange site.
Lumens aren’t mined compared to other cryptocurrencies. A supply of 100 billion Lumens was generated at its launch in 2015 and this increased by 1% every year for the first five years of Stellar’s operation. It later reached 105 billion in circulation.
However, the Stellar community reached a consensus in 2019 that the supply was unnecessarily large and so, the Stellar Development Foundation reduced the number of coins to 50 billion.
Features of Stellar
Stellar also has its own features that separate it from the rest of cryptocurrencies. Some of its notable features include StellarX and Stellar Consensus Protocol. Here are Stellar’s features:
One of the most notable features of Stellar cryptocurrency is its own trading platform where users can convert their fiat money and altcoins. StellarX is a peer-to-peer marketplace of Stellar so you don’t have to look for other platforms to create transactions.
StellarX doesn’t keep order books or has its own trading system, that’s why it’s not considered an exchange site. Instead, StellarX is a browser for the cryptocurrency’s open marketplace.
StellarX lets its users trade directly with other users on the platform and take full control of their funds or private keys. This means that there’s no middleman during any transaction.
The platform is free and only charges a flat per-transaction fee for as low as 0.00001 XLM.
Stellar Consensus Protocol
Stellar and Ripple have some similarities because McCaleb worked on Ripple before creating Stellar.
When it comes to the consensus algorithm, Stellar uses the Federated Byzantine Agreement for its transactions. In this algorithm, rather than requiring each node to verify transactions, it allows the nodes to choose which nodes will agree to accept the result.
Meanwhile, Ripple uses the Byzantine Consensus Algorithm where the nodes must come to an agreement to ensure the legitimacy of transactions since it relies on a set of predetermined nodes.
One of Stellar’s unique features is multi-currency transactions where users are allowed to create transactions across multiple currencies. For instance, if a person is looking for EUR in exchange for ETH, ETH in exchange for BTC, and BTC in exchange for USD, Stellar will find a way for that person to get the USD.
Fast and secured
Stellar doesn’t rely on miners to verify transactions. Instead, computers on the network cooperate with each other, resulting in lightning-fast transaction times and low fees. In addition to its quick feature, Stellar is also secure. Each interconnected node has a duplication of the distributed transaction ledger. This ensures the same level of protection as other top cryptocurrencies like Bitcoin and Ethereum.
Advantages of Stellar
Here are some of the advantages of Stellar:
- Transactions in Stellar are faster compared to other cryptocurrencies. Users will only wait 5 seconds for the transactions to be completed and verified.
- The platform serves as an ecosystem protected from Denial-of-Service or DoS attacks.
- IBM, a global technology based in the United States is one of Stellar’s major partners. Users are guaranteed the technological expertise needed for a major project like cryptocurrencies.
- The platform can also be used by other projects to launch ICOs.
- Stellar is quicker and more versatile because it can incorporate support for payments with the use of the Lightning Network.
Where to buy Stellar Lumens
You’ll find Stellar almost in all major cryptocurrency exchanges. If you want to purchase Lumens in other exchanges, here are the top exchanges you can choose from:
- Coinbase – This is one of the most popular crypto exchanges today. It is based in the United States and offers a wide range of cryptocurrencies such as Bitcoin, Ethereum, Bitcoin Cash and more.
- Kraken – Kraken is another popular crypto exchange that offers trading in various cryptocurrencies. You can also buy and sell cryptocurrencies here like XLM, BTC, ETH and others using fiat money such as US dollars, Japanese yen, Euro, and others.
Where to store Stellar Lumens
Once you have your Lumens, you need a safe place where you can store them and there’s a wide range of hot and cold wallets that you can use.
Here are some of the options you can choose from:
- Hardware wallets – This type of wallet allows you to store your Lumens without the use of the internet. Hardware wallets come in USB-type devices that have side buttons to control the device. Here are some of the hardware wallets available:
- Ledger Nano S
- Ledger Nano X
- Software wallets – This is the type of wallet that you can access online using any device. To access it, you’ll need to create an account. Some examples of this wallet are Exodus, Electrum Bitcoin Wallet, Jaxx Liberty and more.
- Paper wallets – As its name suggests, this wallet is a paper where your private keys and QR code is displayed.
- Desktop wallets – Desktop wallets can be installed on your desktop computer. Using an antivirus is recommended since you’ll be using the internet to access your wallet. Some examples of desktop wallets are Bitcoin Core, MultiBit, Armory and more.
- Mobile wallets – Mobile wallets are installed on your mobile device, giving you a fast and easier way to access your funds. Find a wide range of mobile wallets such as Coinomi, Safepal, Mycelium and others.
Discover what Stellar can offer
Stellar offers its users a way to create cheap transactions quickly without any hassle. With the wide range of cryptocurrencies available today, Stellar is one of the top digital assets that can keep up with other coins in the market. Its technology proves that it will stay in the crypto world for a long time.