Tuesday, November 30, 2021

Is Stellar stealing Etherum’s spotlight?

The Takeaway:

Stellar public blockchain and its native currency XLM have seen a significant rise since its launch. Many big firms like IMB are using stellar's technology to make international payments. Founded by Mt. Gox founder Jed McCaleb in 2014, Stellar has gone through many changes over the years. The open-source, decentralized platform has emerged as a competitor to Ethereum.

ADVERTISEMENTKillerlaunch domains

Stellar is an open-sourced, decentralized protocol that allows cross border payments between any pair of currencies, including cryptocurrency to fiat. Jed McCaleb, who also co-founded Ripple, launched the payment network back in 2014. In the initial year, Stellar secured funding worth $3 million from Stripe. The project was started as a decentralized payment network and protocol with the native currency stellar (XLM). At its launch, the payment network had 100 billion stellar. Steller being decentralized stays in sync with its own accord. What makes Stellar different from other payment networks is the cost of the transactions which the company claims to be less than of a millionth of a dollar. There are several apps based on Stellar that provide payment services across the globe.


A1 going for a stellar crypto introduction

A1, the largest mobile provider that serves more than 7 million mobile and fixed lines services across the country, is planning to adopt cryptocurrency. According to an Austrian tech news outlet, Stellar is among the other major cryptocurrencies that the company is experimenting with. A1 is already testing BTC, Dash, ethereum, litecoin, stellar and XRP for payments at various local stores across the country.

Markus Schreiber, the head of A1’s business marketing, said that in their pilot project, they would be testing the demand and acceptance of the digital currencies in the country. The mobile company also announced that if the pilot project proves to be successful, they would add other cryptocurrencies as well.


Stellar anchoring a digital asset custodian?

Digital asset custodian Anchorage recently announced its support for Stellar’s currency XLM and Tezos. Diogo Mónica, Co-founder and President of Anchorage announced via medium post that clients who hold XLM can now receive inflation awards, which is 1% for the Stellar Lumens XLM. The company also mentioned that it is essential for XLM holders to enable inflation collection in order to earn the rewards, otherwise their assets would be diluted.

Anchorage is among the first regulated custodian to offer support to Stellar. The asset custodian firm recently raised $40 million in series B funding. Visa and blockchain capital were among the top investors. Numerous reports suggest that the custodian’s decision to support Stellar and Tezos would help them compete with companies like Coinbase, BitGo, Fidelity. The company also announced that they would be enabling all participative mechanisms for all the assets that the custody supports.


Stellar is offering 3,000,000 lumens

Stellar fund community holds a quarterly competition to allow developers to give suggestions that might help improve the Stellar network. Currently, 2nd round of Stellar community fund is in progress, which commenced on 12th July and will run until 12th October. In this competition, developers submit proposals to enhance the network which are discussed and then voted upon by the community. Final voting for this round will take place in the second week of October to find the best proposal. According to the information available on the official website of Stellar community, total eight winners of the second round will receive a proportional share from 3,000,000 lumens based on votings. So far, many proposals have been submitted which are available on the stellar community’s website.


Decentralization at work

Stellar, being open-source, allows everyone to contribute to the code. Developers can suggest proposals to change the core protocol or the ecosystem standard. The process to make changes in the core protocol is more complicated than to make changes in the network’s ecosystem. Proposals that suggest changes in the core protocol are submitted as Core Advancement Proposals (CAPs) and these proposals go through multiple steps process before going live on the network. A core advancement proposal has to be accepted by the majority of network validators before going live on the network.

Proposals that suggest a change in the standards, protocols, and methods used in the ecosystem,  which are built on top of the network are categorized as Stellar Ecosystem Proposals (SEPs). SEPs are further divided into two categories informal and standard. Informal SEPs are open for use by Stellar network but are not endorsed by Stellar Development Foundation (SDF). And Standard ESPs are supported by SDF and are also open to Stellar network. It is not necessary that an ESP has to be accepted by the majority of network validators before implementing it.


Improvements made in the first round

Astrograph proposal was among the winners of the previous round. This proposal suggested a framework that lowered the entry threshold to the Stellar ecosystem and made it possible to develop Stellar-based applications in hours instead of weeks. Stellar Guard was another proposal which got accepted. Stellar Guard suggests two-step authentication for XLM transactions to keep the users’ accounts safe and secure.


Is the Ethereum killer living up to its name?

One of the leading blockchain platforms Ethereum is now facing competition from the Stellar as more and more new projects are using later’s platform to issue tokens. Germany’s first STO, Bitbond used Stellar. Netherland based VMC who recently launched STO is also using Stellar’s technology. According to various reports, Stellar provides simple functionalities that support simple apps which are faster and easier to use.

Earlier this year IBM announced that it had signed six international banks who would use Stellar public blockchain for international payments. IBM currently uses World Wire to settle international payments in 72 countries. World wire is also built on Stellar’s blockchain technology. Philippines-based RCBC, Brazil’s Banco Bradesco, and Bank Busan of South Korea are among the six other banks who would use Stellar for the international payment.

The average transaction processing time on stellar is 5 seconds, which is way less than 3 minutes on Ethererum. Stellar also takes the edge on transaction fees. The fee charged by Steller is way less than Etheruem because of stellar’s built-in decentralized exchange.


Will this be a repeat of Mt Gox’s costly programming error?

McCaleb is an influential personality in the crypto space. He founded Mt.Gox, which he sold off before it got bankrupt. McCaleb also founded the Ripple cryptocurrency and the eDonkey network. He currently works as CTO of Stellar which he co-founded back in 2014. McCaleb’s net worth is estimated to be close to $20 billion, most of which is kept in Ripple’s currency.

In a lawsuit filed by Jones and Steinmetz, two former traders on Mt.Gox alleged McCaleb of being aware of the severe security flaws on the exchange. The lawsuit claims that McCaleb knew about the security flaws in Mt.Gox before he sold it off. In their appeal, Jones and Steinmetz claimed that if they had known about the significant security risk, they would have never used the platform. They together lost more than 50,000 BTC in the MT. Gox hack.

If the charges are proved to be real than the Stellar and Ripple might also face trust issues from the crypto community because of their association with the Jed McCaleb.

ADVERTISEMENTBtrz jokerbtc 728x90 en

Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Thomas Allums
Thomas Allums
Although Thomas is an experienced writer, he is also a passionate musician who loves to travel often. He is based in New York and loves to spread the word about decentralization throughout his neighborhood.

Leave A Reply

Please enter your comment!
Please enter your name here