What is the virtual currency Stellar (XLM)? A thorough explanation of its features, differences from Ripple, the exchanges where you can purchase it, and its future prospects
Stellar (XLM) and Ripple (XRP) are often said to be similar cryptocurrencies.
So there may be people who mix them up?
In short, Stellar is a cryptocurrency aimed at individuals, while Ripple is aimed at enterprises, so they have different purposes.
This article thoroughly introduces the following five aspects of Stellar.
- Overview of Stellar
- Characteristics of Stellar
- Differences between Stellar and Ripple
- Exchanges where Stellar can be purchased and how to buy
- The future prospects of Stellar
Stellar is consistently among the top in market capitalization and has promising potential, so please read to the end.
What is Stellar (XLM) / Features
Stellar (XLM) is a cryptocurrency that,developed based on Ripplewith Jed McCaleb, who was also involved in Ripple’s development.
Stellar’s unit is lumen (XLM), and its purpose is to build a platform that enables settlements between individuals and between individuals and financial institutions.
Since Stellar can be exchanged for various national fiat currencies and base cryptocurrencies like Bitcoin,SWIFTrepresenting international transfers via banks allows cross-border transfers and settlements at dramatically lower costs and faster speeds.
Although cryptocurrencies are not regulated by each country, Stellar aims to stabilize its circulating supply and thus targets China for regulation.
Considering Bitcoin price fluctuations caused by China in the past, by introducing a Facebook authentication system into Stellar, for China where Facebook is not usable, intervention is prevented.
Differences between Stellar (steller) and Ripple (XRP)
Since the developers of Stellar were originally involved in Ripple’s development, Stellar and Ripple are said to be very similar.
However, in conclusion, Stellar and Ripple can be considered completely separate.
There are three main differences between Stellar and Ripple.
- Differences in payment systems
- Differences in issuance caps
- Differences in algorithms
Now, let's examine each difference in detail.
Differences in payment systems
Ripple isconnected to international networks between banks and focuses on simple and rapid remittance processing,targeting corporate financial institutions, whileStellar targets individuals.
By targeting individuals, Stellar enables individuals and cross-border transfers and online overseas payments with overseas individuals and financial institutions in a simple and speedy way.
Differences in issuance caps
Ripplehas a cap of 100 billion units, whereasStellaris issued to 100 billion units, and after that an annual issuance of 1% increasesis built into the system.
Ripple held about 63% of issued supply, 63 billion XRP, by Ripple Labs, which raised concerns about price drops when Ripple’s XRP was released to the market.
To address this, Ripple Labs locked up about 90% of XRP (about 55 billion) to prevent mass market release.
In contrast, Stellar increases the supply over time, and the incremental supply entering circulation helps deter manipulation and provides a mechanism to avoid price volatility.There is a mechanism to avoid price volatility..
Differences in algorithms
Ripple usesPoC (Proof of Consensus), whereas Stellar uses SCP (Stellar Consensus Protocol).
Stellar’s own algorithm SCP is an improvement over the issues found in Ripple’s algorithm.
The problem with Ripple’s algorithm is that if consensus of 80% or more of the designated validators cannot be reached, the blockchain can fork—an existential issue.
However, Stellar’s algorithm was developed based on Ripple’s technology and is designed to be approved even without 80% consensus, without forking the blockchain.
With these three differences, and especially because the intended users are different, they can be considered completely separate cryptocurrencies.
Exchanges where you can buy Stellar (XLM)
There are no domestic Japanese exchanges that handle Stellar, so you need to buy on overseas exchanges.
Three representative overseas exchanges where you can buy Stellar are:
And on overseas exchanges, Stellar can be purchased through the following process via a domestic exchange:
- Register with a domestic exchange
- Purchase Bitcoin on the domestic exchange
- Register with an overseas exchange that handles Stellar
- Transfer Bitcoin from the domestic exchange to the registered overseas exchange
- Use the Bitcoin transferred to purchase Stellar on the overseas exchange
You can purchase Stellar crypto through the above flow.
Other cryptocurrencies not handled domestically can also be obtained by the same purchase method, so keep that in mind.
Future prospects of Stellar (XLM)
Stellar is....Continue reading here below
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