There is a number of elements needed to be successful in the crypto world. First and foremost, there should be a talented and prominent blockchain designer in the team. Also, a few customer references should be made available, preferably from big businesses operating outside the blockchain world. And Stellar has it all.
Stellar has climbed over the last year from a market value of 15 million dollars to over 4 billion dollars currently. Stellar is currently number 7 on the list of cryptocurrencies, measured by market value.
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Fintech experts have spoken to the financial website Finder.com, predicting that the market value of Stellar’s cryptocurrency, Lumens, will reach 183 billion dollars by the end of 2018. It would represent a potential increase of more than 2300%, exceeding predictions for the majority of other cryptocurrencies.
What is Stellar?
Stellar’s co-founder, Jed McCaleb, was the creator of one of the first bitcoin exchanges, Mt. Gox, as well as one of the founders behind Ripple (XRP) – currently world’s third-biggest cryptocurrency measured by market value.
On the customer side, IBM has announced in October 2017 that they will use Stellar to cooperate with banks to carry out cross-border transfers in the South Pacific. This would mean that a person from Australia will be able to transfer money to Indonesia and pay with Stellar’s cryptocurrency, Lumens.
“Currently, cross-border payments tend to take up to several days to clear. This new implementation is poised to start a profound change in the South Pacific nations, and once fully scaled by IBM and its banking partners, it could potentially change the way money is moved around the world, helping to improve existing international transactions and advancing financial inclusion in developing nations,” said McCaleb in connection with signing the agreement.
IBM spokesperson has expressed that the cooperation may lead to transactions volume of over 1 billion dollars per month in key markets like Australia, New Zealand, Fiji, Samoa, and Tonga by the end of 2018.
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A threat to Ripple
While bitcoin is popular among consumers and ordinary people, Stellar appeals more to businesses. That’s why it’s more about Ripple, which McCaleb also helped create. But there is a number of fundamental differences between Ripple and Stellar. First and foremost, Stellar is currently a non-profit organisation, while Ripple is a normal business with profits in mind. The Ripple company has also been accused of having little focus on the development of its cryptocurrency XRP, while Stellar doesn’t seem to have any of these issues.
Ripple’s network is thus perceived by many as centralised, while Stellar operates in a decentralised way. The latter is, therefore, more in line with Bitcoin’s and blockchain’ original idea.
Currently, Ripple is five times as big as Stellar, based on market value. But this may change in the future.
Cryptocurrencies are extremely volatile, with significant fluctuation. Therefore, they are not suited for every investor. Trading with cryptocurrencies is not subject to EU regulations.
