Stellar (payment network)

Last updated
Stellar
Original author(s)
Developer(s) Stellar Development Foundation
Initial releaseJuly 31, 2014;10 years ago (2014-07-31)
Repository
Written in C++, Rust, Go, Java, JavaScript, Python, Ruby
Operating system Cross-platform
Type Blockchain
License Apache License 2.0
Website stellar.org
Lumen
Denominations
Plurallumens
Symbol *
CodeXLM
Precision10−7
Subunits
 1⁄10000000stroop
Development
White paper The Stellar Consensus Protocol: A Federated Model for Internet-level Consensus [1]
Initial releaseJuly 31, 2014;10 years ago (2014-07-31)
Development statusActive
Ledger
Supply limit50 billion
Website
Website stellar.org

Stellar, or Stellar Lumens (XLM) is an open-source, decentralized cryptocurrency protocol for digital currency to fiat money low-cost transfers which allows cross-border transactions between any pair of currencies. [2] The Stellar protocol is supported by a Delaware nonprofit corporation, the Stellar Development Foundation, though this organization does not enjoy 501(c)(3) tax-exempt status with the IRS. [3] [4]

Contents

History

In 2014, Jed McCaleb, founder of Mt. Gox and co-founder of Ripple, launched the network system Stellar with former lawyer Joyce Kim. Before the official launch, McCaleb formed a website called "Secret Bitcoin Project" seeking alpha testers. [5] The nonprofit Stellar Development Foundation was created in collaboration with Stripe CEO Patrick Collison and the project officially launched that July. Stellar received $3 million in seed funding from Stripe. [6] [7] Stellar was released as a decentralized payment network and protocol with a native currency, stellar. At its launch, the network had 100 billion stellars. 25 percent of those would be given to other non-profits working toward financial inclusion. [8] [9] Stripe received 2 percent or 2 billion of the initial stellar in return for its seed investment. [10] The cryptocurrency, originally known as stellar, was later called Lumens or XLM. [11] In August 2014, Mercado Bitcoin, the first Brazilian bitcoin exchange, announced it would be using the Stellar network. [12] By January 2015, Stellar had approximately 3 million registered user accounts on its platform and its market cap was almost $15 million. [13]

The Stellar Development Foundation released an upgraded protocol with a new consensus algorithm in April 2015 which went live in November 2015. [14] The new algorithm used SCP, a cryptocurrency protocol created by Stanford professor David Mazières. [15]

Lightyear.io, a for-profit entity of Stellar, was launched in May 2017 as the commercial arm of the company. [16] In September 2017, Stellar announced a benefits program, part of its Stellar Partnership Grant Program, which would award partners up to $2 million worth of Lumens for project development. In September 2018, Lightyear Corporation acquired Chain, Inc and the combined company was named Interstellar. [17]

In 2021, Franklin Templeton launched the first “tokenised” US mutual fund using Stellar. [18]

Usage

In 2015, it was announced that Stellar was releasing an integration into Vumi, the open-sourced messaging platform of the Praekelt Foundation in South Africa. [19] Vumi uses cellphone talk time as currency using the Stellar protocol. [20] Stellar partnered with cloud-based banking software company Oradian in April 2015 to integrate Stellar into Oradian's banking platform to add microfinance institutions (MFIs) in Nigeria. [21] [22]

Deloitte announced its integration with Stellar in 2016 to build a cross-border payments application, Deloitte Digital Bank. [23] In December 2016, it was announced that Stellar's payment network had expanded to include Coins.ph, a mobile payments startup in the Philippines, ICICI Bank in India, African mobile payments firm Flutterwave, and French remittances company Tempo Money Transfer. [24]

In October 2017, Stellar partnered with IBM and KlickEx to facilitate cross-border transactions in the South Pacific region. The cross-border payment system developed by IBM includes partnerships with banks in the area. [25] [26] The Lumens digital currency was ranked 13th in market capitalization at the time of the IBM partnership. [27]

In December 2017, TechCrunch announced Stellar's partnership with SureRemit, a Nigerian-based non-cash remittances platform. [28]

On January 6, 2021, the Ministry of Digital Transformation of Ukraine announced cooperation and partnership with Stellar in development of Ukraine digital infrastructure, after which Stellar value increased by 40%. [29]

One of its most notable partnerships is with MoneyGram International, a global leader in money transfer services with over 400,000 locations worldwide.

The partnership between Stellar and MoneyGram was officially announced in October 2021. The collaboration aimed to integrate Stellar’s blockchain technology into MoneyGram’s existing payment infrastructure. This integration enables the use of Stellar’s native cryptocurrency, XLM, and the fiat-backed stablecoin USDC (USD Coin) by the company Circle. Circle is a regulated fintech and it’s USDC Cryptocurrency stable coin is a trusted, widely accepted and highly liquid digital dollar; for seamless cross-border payments and real-time settlements.

The partnership went live in June 2022, allowing MoneyGram customers in various countries to send and receive payments more efficiently. The service leverages the Stellar blockchain to offer near-instant transfers while minimizing fees compared to traditional remittance systems.

Ecosystem

Stellar has an active community ecosystem and supports projects that utilize the Stellar Network with the Stellar Community Fund. [30]

Overview

Stellar is an open-source protocol for exchanging money or tokens using the Stellar Consensus Protocol. [1] The platform's source code is hosted on GitHub.

Servers run a software implementation of the protocol, and use the Internet to connect to and communicate with other Stellar servers. Each server stores a ledger of all the accounts in the network. 3 nodes are operated by the Stellar Development Foundation, in conjunction with 22 other organizations, providing for a total of 77 validator nodes. [31] Transactions among accounts occur not through mining but rather through a consensus process among accounts in a quorum slice. [32] The current network fee is 100 stroops, equivalent to 0.00001 XLM. [33]

See also

Related Research Articles

<span class="mw-page-title-main">Digital currency</span> Currency stored on electronic systems

Digital currency is any currency, money, or money-like asset that is primarily managed, stored or exchanged on digital computer systems, especially over the internet. Types of digital currencies include cryptocurrency, virtual currency and central bank digital currency. Digital currency may be recorded on a distributed database on the internet, a centralized electronic computer database owned by a company or bank, within digital files or even on a stored-value card.

A cryptocurrency exchange, or a digital currency exchange (DCE), is a business that allows customers to trade cryptocurrencies or digital currencies for other assets, such as conventional fiat money or other digital currencies. Exchanges may accept credit card payments, wire transfers or other forms of payment in exchange for digital currencies or cryptocurrencies. A cryptocurrency exchange can be a market maker that typically takes the bid–ask spreads as a transaction commission for its service or, as a matching platform, simply charges fees.

<span class="mw-page-title-main">Bitcoin</span> Decentralized digital currency

Bitcoin is the first decentralized cryptocurrency. Based on a free-market ideology, bitcoin was invented in 2008 by Satoshi Nakamoto, an unknown person. Use of bitcoin as a currency began in 2009, with the release of its open-source implementation. In 2021, El Salvador adopted it as legal tender. It is mostly seen as an investment and has been described by some scholars as an economic bubble. As bitcoin is pseudonymous, its use by criminals has attracted the attention of regulators, leading to its ban by several countries as of 2021.

<span class="mw-page-title-main">Cryptocurrency</span> Digital currency not reliant on a central authority

A cryptocurrency, crypto-currency, or colloquially, crypto, is a digital currency designed to work through a computer network that is not reliant on any central authority, such as a government or bank, to uphold or maintain it.

<span class="mw-page-title-main">XRP Ledger</span> Ripple

The XRP Ledger (XRPL), also called the Ripple Protocol, is a cryptocurrency platform launched in 2012 by Ripple Labs. The XRPL employs the native cryptocurrency known as XRP, and supports tokens, cryptocurrency or other units of value such as frequent flyer miles or mobile minutes.

<span class="mw-page-title-main">History of bitcoin</span> Cryptocurrency

Bitcoin is a cryptocurrency, a digital asset that uses cryptography to control its creation and management rather than relying on central authorities. Originally designed as a medium of exchange, Bitcoin is now primarily regarded as a store of value. The history of bitcoin started with its invention and implementation by Satoshi Nakamoto, who integrated many existing ideas from the cryptography community. Over the course of bitcoin's history, it has undergone rapid growth to become a significant store of value both on- and offline. From the mid-2010s, some businesses began accepting bitcoin in addition to traditional currencies.

Blockchain.com is a cryptocurrency financial services company. The company began as the first Bitcoin blockchain explorer in 2011 and later created a cryptocurrency wallet that accounted for 28% of bitcoin transactions between 2012 and 2020. It also operates a cryptocurrency exchange and provides institutional markets lending business and data, charts, and analytics.

<span class="mw-page-title-main">Ethereum</span> Open-source blockchain computing platform

Ethereum is a decentralized blockchain with smart contract functionality. Ether is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market capitalization. It is open-source software.

Circle is a peer-to-peer payments technology company that now manages stablecoin USDC, a cryptocurrency the value of which is pegged to the U.S. dollar. It was founded by Jeremy Allaire and Sean Neville in October 2013. Circle is headquartered in Boston, Massachusetts. USDC, the second largest stablecoin worldwide, is designed to hold at or near a stable price of $1. The majority of its stablecoin collateral is held in short-term U.S. government securities.

A blockchain is a distributed ledger with growing lists of records (blocks) that are securely linked together via cryptographic hashes. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Since each block contains information about the previous block, they effectively form a chain, with each additional block linking to the ones before it. Consequently, blockchain transactions are resistant to alteration because, once recorded, the data in any given block cannot be changed retroactively without altering all subsequent blocks and obtaining network consensus to accept these changes. This protects blockchains against nefarious activities such as creating assets "out of thin air", double-spending, counterfeiting, fraud, and theft.

CoinDesk is a news site specializing in bitcoin and digital currencies. Founded by Shakil Khan, the firm also provides guides to bitcoin for those new to digital currencies.

<span class="mw-page-title-main">ShapeShift</span> Swiss digital asset trading company

ShapeShift AG was a cryptocurrency exchange which operated from 2014 to 2021 and was headquartered in Switzerland.

Jed McCaleb is an American programmer, entrepreneur, and philanthropist. He is the founder, chairman and ex-CEO of aerospace startup Vast and a co-founder and the CTO of Stellar. Prior to co-founding Stellar, McCaleb founded and served as the CTO of the company Ripple until 2013. McCaleb is also known for creating the Mt. Gox bitcoin exchange, and the peer-to-peer eDonkey and Overnet networks as well as the eDonkey2000 application.

Bitwala is a blockchain banking service, headquartered in Berlin, Germany, that was founded by Jörg von Minckwitz, Jan Goslicki, and Benjamin P. Jones in October 2015.

<span class="mw-page-title-main">Bitcoin scalability problem</span> Scaling problem in bitcoin processing

The Bitcoin scalability problem refers to the limited capability of the Bitcoin network to handle large amounts of transaction data on its platform in a short span of time. It is related to the fact that records in the Bitcoin blockchain are limited in size and frequency.

A cryptocurrency wallet is a device, physical medium, program or an online service which stores the public and/or private keys for cryptocurrency transactions. In addition to this basic function of storing the keys, a cryptocurrency wallet more often offers the functionality of encrypting and/or signing information. Signing can for example result in executing a smart contract, a cryptocurrency transaction, identification, or legally signing a 'document'.

Cryptocurrency and crime describe notable examples of cybercrime related to theft of cryptocurrencies and some methods or security vulnerabilities commonly exploited. Cryptojacking is a form of cybercrime specific to cryptocurrencies used on websites to hijack a victim's resources and use them for hashing and mining cryptocurrency.

Paxos Trust Company is a New York–based financial institution and technology company specializing in blockchain. The company's product offerings include a cryptocurrency brokerage service, asset tokenization services, and settlement services. ItBit, a bitcoin exchange run by Paxos, was the first bitcoin exchange to be licensed by the New York State Department of Financial Services, granting the company the ability to be the custodian and exchange for customers in the United States.

Chia Network Inc. is a US-based blockchain technology company. The company built the Chia blockchain that uses proof of space and proof of time consensus protocols and issues the digital currency Chia (XCH). Chia Network was founded in 2017 by Bram Cohen, the creator of BitTorrent, and Ryan Singer. Its headquarters are in South San Francisco, California.

References

  1. 1 2 Mazieres, David (25 February 2016). "The Stellar Consensus Protocol: A Federated Model for Internet-level Consensus" (PDF). Retrieved 18 May 2021.
  2. ↑ Ben Dickson (January 30, 2018). "Can blockchain democratize education? This startup seems to think so". The Next Web. Retrieved August 26, 2018.
  3. ↑ "Stellar FAQ". Archived from the original on 14 January 2021. Retrieved 15 January 2021.
  4. ↑ Jillian D’onfro (31 July 2014). "PayPal's Cofounder Is Supporting A New Non-Profit That Will Tackle The Vision PayPal 'Never Accomplished'". Business Insider. Retrieved 23 April 2015.
  5. ↑ "Mt. Gox, Ripple Founder Unveils Stellar, a New Digital Currency Project". Wall Street Journal. 31 July 2014.
  6. ↑ "New Bitcoin challenger launches". Fortune.
  7. ↑ Michael del Castillo (5 August 2014). "Stripe takes on bitcoin with rival digital currency Stellar". The Irish Times. Retrieved 20 November 2015.
  8. ↑ "Payment processor Stripe helps launch a new currency, the Stellar". 31 July 2014.
  9. ↑ "PayPal's Cofounder Is Supporting A New Non-Profit That Will Tackle The Vision PayPal 'Never Accomplished'". Business Insider .
  10. ↑ "Stripe Backs Non-Profit Decentralized Payment Network Stellar, From Mt. Gox's Original Creator". 31 July 2014.
  11. ↑ "2 Game-Changing New Cryptocurrencies With Serious Backing".
  12. ↑ Metz, Cade. "New Digital Currency Aims to Unite Every Money System on Earth". Wired.
  13. ↑ "Tech in Asia - Connecting Asia's startup ecosystem". www.techinasia.com.
  14. ↑ Cade Metz (8 April 2015). "An Algorithm to Make Online Currency as Trustworthy as Cash". WIRED. Condé Nast. Retrieved 23 April 2015.
  15. ↑ Tom Simonite (April 15, 2015). "A New Competitor for Bitcoin Aims to Be Faster and Safer".
  16. ↑ Jeff John Roberts (May 11, 2017). "Stripe-Backed Stellar Places a New Bet on Blockchain in the Developing World". Fortune. Retrieved August 26, 2018.
  17. ↑ "Blockchain Startup Chain Merges With Stellar to Accelerate Use". Bloomberg.com. 10 September 2018.
  18. ↑ Noonan, Laura (2021-12-10). "Blockchain-powered breakthrough on mutual fund". Financial Times. Retrieved 2023-08-15.
  19. ↑ Biz Carson (5 February 2015). "Stellar, South African nonprofit to bring digital savings to young girls". GigaOm. Archived from the original on 28 February 2015. Retrieved 23 April 2015.
  20. ↑ Tom Simonite (20 February 2015). "Bitcoin-Inspired Digital Currency to Power Mobile Savings App". MIT Technology Review. Archived from the original on 20 May 2015. Retrieved 23 April 2015.
  21. ↑ Karen Webster (2 March 2015). "Stellar and Solving the Unexpected Tragedy of the Financial System". PYMENTS.com. Retrieved 23 April 2015.
  22. ↑ Paul Vigna (28 February 2015). "Stellar Takes a Step Into the Microfinance World". Wall Street Journal. Retrieved 23 April 2015.
  23. ↑ Diana Asatryan (May 3, 2016). "Deloitte Taps Blockchain Startups to Build New Core Banking System". Bank Innovation. Retrieved August 26, 2018.
  24. ↑ FORTUNE. "Stripe-Backed Stellar Kicks Off Worldwide Money Transfers". Fortune. Retrieved 2017-01-03.
  25. ↑ "Stellar jumps 20% after Stripe says it may add support for the digital coin". CNBC . 24 January 2018.
  26. ↑ "IBM and Stellar Launch Blockchain Banking Across Multiple Countries". Fortune.
  27. ↑ IBM has a new blockchain for banks to speed up cross-border payments Ryan Browne, CNBC, 18 October 2017
  28. ↑ Jake, Bright. "Africa's SureRemit joins the tokenized race to win the global remittance market". TechCrunch. Archived from the original on February 24, 2011. Retrieved August 28, 2018.{{cite web}}: CS1 maint: bot: original URL status unknown (link)
  29. ↑ "Мінцифра співпрацюватиме зі Stellar Development Foundation над розвитком ринку віртуальних активів" . Retrieved 7 January 2021.
  30. ↑ "Stellar Community Fund". communityfund.stellar.org.
  31. ↑ "Stellarbeat.io - Stellar network visibility". stellarbeat.io. Retrieved 2024-09-25.
  32. ↑ Tom Simonite (15 April 2015). "A New Competitor for Bitcoin Aims to Be Faster and Safer". MIT Technology Review. Retrieved 2021-01-01.
  33. ↑ contributors, Stellar org and. "Transaction Fees, Minimum Balances, and Surge Pricing | Stellar Developers". www.stellar.org. Retrieved 2020-05-23.{{cite web}}: |last= has generic name (help)
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.