- Stellar was co-founded in 2014 by Jed McCaleb and Joyce Kim
- The Stellar Network aims to offer a fast and cheaper way of transferring money across international borders.
- IBM, ICICI, HTV Exodus, and Trezor have inked partnerships with Stellar for easy and fast access to global financial services.
What is Stellar?
Are you looking for an answer to your question – “What is Stellar? We have got you covered. You have come to the right place. This article will explain how Stellar works, what problem does Stellar solve, and why Lumens has become one of the leading cryptocurrencies today. We have made sure that we answer all your questions about Stellar here. Let’s dive into it now.
Stellar, founded in 2014, offers two benefits to its user community. The first of which is its payment network. It is distributed and offers a quick and affordable way to transact across borders. Stellar also provides an option to host ICOs.
The native currency of Stellar Network is the Lumen (XLM). It is an essential part of the Stellar network. The Lumen allows making quick international payments between different countries.
What is Stellar? – The Network
Stellar is an open-source and public blockchain network. It aims to offer the crypto community a faster and easier way to transfer money internationally. Stellar will facilitate money of all types such as the Euro, the USD, Yen, or even Bitcoin.
The Stellar team is creating a single network for all financial systems globally. This network will enable financial systems worldwide to send money anywhere in the world in a fast and cheaper manner. If you are wondering how the native currency of Stellar fits in all these? Lumen will power all the transactions that will happen on the Stellar network.
How Does Stellar Enable Low-Cost Transactions?
The technology which powers the Stellar blockchain network’s low-cost transactions is known as the consensus method. The consensus method enables all Stellar network nodes to validate each transaction within seconds. This efficiency is because of the Stellar team. They implemented an ingenious mechanism to verify all the transactions within the Stellar network quickly.
In Stellar blockchain, each node manages a mini-network. These nodes check all the transactions that pass through the Stellar network. Each mini-network, under the management of a node, is known as quorum slices. All these mini-networks are above each other and hence, all transactions are still verified by multiple nodes.
The current efficiency of the Stellar network wouldn’t have been possible if all the nodes were reaching the consensus after every transaction.
How Does the Stellar Network Work?
You will need an account before you start interacting with the Stellar network. A Stellar network account will get you a public key and a secret seed. Both public key and secret key ensure that you are able to access your account safely and securely.
The second step is to transfer funds to the Stellar network’s anchor. An anchor is an entity within the stellar network. A Stellar network holds funds on behalf of the user. It then issues digital credits on to your stellar network account.
The banks, remittance organizations, and any institutions keeping money on your behalf act as an anchor on the network. Hence, an anchor is a connecting link between the currencies and the Stellar network. A user can transfer their funds instantly on the Stellar network once they transfer funds on their anchor.
Key Leadership – The Stellar Network
Jed McCaleb is one of the most high-profile founders of Stellar. He was the creator of Mt. Fox, a bitcoin exchange. However, Mt. Gox is defunct now. Jed McCaleb is also the Co-Founder of Ripple.
As per an announcement made by Stellar in March 2019, Danelle Dixon took over the position of executive director of Stellar from Jed McCaleb. Danelle Dixon was working as a COO with Mozilla Network for a long time.
Joyce Kim is the other Co-Founder of the Stellar Network. She was the former executive director of Stellar. In the past, Kim was working as an attorney at Sherman & Sterling and Wilmer Hale.
Later in 2017, Kim was heading Sparkchain Capital as its managing director. It was an early-stage VC fund focused on investing in the most promising innovations from the blockchain and crypto sector.
Current Market Scenario of the Stellar
At the time of writing, the price of Stellar is $0.105467. Stellar has a market cap of $2.16 billion. Hence, it is 15th among all cryptocurrencies in terms of market cap. On October 26, 2014, the price of each XLM was $0.0019.
The price of XLM grew by more than 250% and reached $0.004978 on January 25, 2015. Until January 2018, there was no drastic rise or gain in the price of XLM. On 4th January 2018, the price of XLM reached a high of $0.896850.
Future of the Stellar Network
We expect the Stellar Network to grow even further. The Stellar team has made partnerships with many leading companies around the world. One of the most promising partnerships that Stellar has is its partnership with IBM. Under their partnership, IBM will use the Stellar network as a payment structure. A partnership with the Stellar Network will allow IBM to access global financial services in a secure and transparent manner.
The other promising partnerships made by the Stellar team are with ICICI – India’s 3rd largest bank, SatoshiPay, HTV Exodus – A Global Mobile Manufacturer, Trezor – A Popular Hardware Wallet, and many more.
We believe that such high-level partnerships will benefit the Stellar network greatly. It will enhance the capabilities of the Stellar Network. However, it has to face competition from some of its rivals such as Cardano. However, it will be interesting to see how Stellar holds on its own in the crypto market.