Stellar is an open-source payment distribution infrastructure. It makes use of what is known as “leapfrog technology” to connect individuals, payment systems and banks throughout the world, with a focus on the developing nations. It facilitates transactions of multiple currencies and assets reliably and efficiently for just fractions of a penny, using a cryptocurrency known as Lumens (XLM) to bridge between sender and receiver.
The future of banking
Stellar’s Lumens (XLM) share a number of similarities with Ripple and can even be considered a decentralised version of XRP. However, unlike Ripple, Stellar is not controlled.
The intention of the team behind Stellar is to incorporate micropayments, remittances, mobile money and services for those without bank accounts. These services are likely to include low-cost loans as well as a means to store and save earnings – and it’s easy to see how this could be beneficial in helping individual users and businesses based in developing nations to connect financially with the wider world.
Each account holder will be required to hold a minimum balance of 1 Lumen, and each transaction incurs a fee of just 0.00001 Lumen – primarily to prevent malicious users from flooding the network via a Denial of Service (DoS) attack.
XLM is already available on several large exchanges, and has initially proved popular on Upbit, Bittrex, Poloniex, Kraken and Binance among others. It has its own decentralised exchange, but due to increased interest in the currency it is currently struggling – and if ever there was an indication that a currency is making waves, this is it. There is a market cap of 103 billion tokens, approximately 18 billion of which are already in circulation.
Having partnered with IBM and Tempo, Stellar’s credentials are already looking impressive. In an increasingly globalised world, it could very well be the future of banking – making the present a pertinent time to invest in XLM.