Stellar
Stellar is an open-source protocol for value exchange. It was founded in 2014 led by Jed McCaleb and Joyce Kim with a number of board members. The protocol is supported by the non-profit Stellar Development Foundation.
Wikipedia describes the design of Stellar as follows:
Stellar is an open-source protocol for exchanging money. Servers run a software implementation of the protocol, and use the Internet to connect to and communicate with other Stellar servers, forming a global value exchange network. Each server stores a record of all “accounts” on the network. These records are stored in a database called the “ledger”. Servers propose changes to the ledger by proposing “transactions”, which move accounts from one state to another by spending the account’s balance or changing a property of the account. All of the servers come to agreement on which set of transactions to apply to the current ledger through a process called “consensus”. The consensus process happens at a regular interval, typically every 2 to 4 seconds. This keeps each server’s copy of the ledger in sync and identical.
At its launch
Stellar was based on Ripple. However, the protocol was later updated with a new consensus algorithm. The code for the new algorithm was released in April of 2015
The official name of the coin associated with Stellar is lumen, XLM.
Real world applications of Stellar
Several nonprofit organizations and businesses are using Stellar for their financial infrastructure particularly in the developing world
The Praekelt Foundation, has integrated Stellar into Yumi that is an open-source messaging app that allows young girls in sub-Saharan Africa to save money on airtime credits.
Another example is Oradian, a cloud-based banking software company, that is planning to use Stellar to connect microfinance institutions in Nigeria.
In December of last year Stellar announced more partnerships in the Philippines, India and West Africa.
In October of 2017, Stellar announced it had partnered with IBM to increase the speed of global payments. Consulting firm Deloitte is also a partner.
Stellar's transaction speed is very fast
In contrast to coins such as bitcoin,
transactions through Stellar take only two to five seconds. Users can quickly exchange government-backed fiat currencies such as U.S. dollars into Euros and vice versa.
Jed McCaleb
McCaleb is an American programmer. He is widely known for creating peer-to-peer technologies such as
eDonkey used for sharing files.
He was also involved with the large Japanese bitcoin exchange
Mt. Gox but it was later sold to Mark Kapeles. The exchange eventually was closed after many of its bitcoins were stolen and the exchange filed for bankruptcy after scandalously bad if not criminal management problems.
In 2011 McCaleb founded another company Ripple that also focuses on payments and rose considerably in value last year. As a recent
Digital Journal article reports Ripple is now the second largest cryptocoin in terms of market capitalization. McCaleb left Ripple in 2013 and went on to lead the development of Stellar in 2014. Ripple is also working with financial institutions in South Korea and Japan using the ripple coin XRP.
McCaleb is now focused on Stellar.
The Stellar website claims that it operates on a non-profit basis. It covers operating costs through selling some of its digital currency holdings and through donations.
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