What is Stellar? A handy guide to XLM: the nonprofit crypto

There’s no denying 2017 was the year for cryptocurrencies. So many of these innovative assets,  which were previously completely unknown, have now been written about and debated everywhere. While much of the attention directed at cryptocurrencies was due to their meteoric rise over the past year, it was also due to the fact that they present something new from a financial and technological standpoint.

One fine example is Stellar. While its cryptocurrency, called Lumens (or XLM) was part of the cryptocurrency boom, rising thousands of percents and becoming a top 10 currency, it was the company’s vision that separated it from others. Among other things, Stellar has the declared agenda of reducing poverty and helping bankless societies.

Trade XLM Now

Virtual currencies are highly volatile. Your capital is at risk.

Using blockchain to help the poor

Launched in 2014, Stellar is a blockchain-based platform designed for quick currency exchange and money transfer. Originally based on Ripple Labs’ protocol, Stellar later forked and eventually rewrote its code entirely. Like XRP by Ripple Labs, Stellar’s XLM currency serves as a bridging currency for conducting various transactions on the Stellar platform. This is the reason each XLM token has a very low value when compared to most other top 10 cryptos.

A unique aspect of Stellar is the fact that it is a nonprofit organization. Founded by two well-known figures in the tech world, eDonkey creator, Jed McCaleb and veteran investor, Kim Joyce, Stellar aims to utilize the power of blockchain technology to help the poor, among others.

Using Stellar’s protocol, which requires no ‘middleman’ or third party for transferring funds, even those who don’t have a bank account can enjoy basic banking services. Moreover, since Stellar can be used to convert different currencies and other tokens, users could quickly convert different means of payments. For example, one application on the platform is the ability to turn phone credits back into money.

Making money more efficient

While it shares many similarities with other blockchain networks, Stellar does work a little differently. On the Stellar network, there are multiple servers, which communicate with one another in 2-5 second intervals. In addition, each server contains a copy of the public ledger, which logs all transactions on the network. The ledger is also updated every few seconds.

Whenever an order is placed on the network, the Stellar protocol automatically finds the best exchange rate for the transaction. While this could be as easy as converting one currency to another, the algorithm could also create a conversion passing through multiple currencies, if the end result is more beneficial for both parties. Each transaction incurs a small fee of fractions of cents, charged in XLM.

Despite the fact that Stellar said it aims to help the poor, a major step the company took actually had to do with traditional banking. In October, 2017, IBM announced that it will be using the Stellar protocol to develop a cross-border, blockchain-based payment system for  large banks.

Stellar: Now on eToro

Since it is a top 10 cryptocurrency, it is no wonder Stellar Lumens have been in high demand, as part of the recent crypto craze. Therefore, eToro has decided to add XLM to its ever growing cryptocurrency offering, and you can now buy and sell Stellar Lumens with just a few clicks on eToro. Whether it’s because they have faith in the currency, or due to Stellar’s agenda of promoting social change, the nonprofit blockchain company has attracted many investors around the world – and now eToro clients can take part as well.

Trade Stellar Now

Virtual currencies are highly volatile. Your capital is at risk.

eToro USA LLC; Virtual currencies are highly volatile. Your capital is at risk.