Stellar cryptocurrency’s tokens are called lumens.
Introduced in 2014, Stellar wanted to reach the world’s population that didn’t have access to banks. As it evolved, Stellar adjusted lumens to a different niche, and with a different purpose. They now aim to allow financial companies to store money and move it quickly and inexpensively.
Stellar’s objective remains to disrupt the global payment system. Its blockchain makes moving lumens from institutions and people easy and cheaper than similar services from other payment firms.
How was Stellar formed?
Stellar was founded by entrepreneur and former Ripple employee Jed McCaleb and attorney Joyce Kim in 2013. The two were disenchanted with Ripple and wanted to create different crypto, more in line with their vision.
How is Stellar different?
Stellar isn’t trying to displace fiat money. It is simply attempting to create a financial system within which international payments can be made for less and fast.
If you’ve ever used Paypal or other remittance services such as WesternUnion, you’d know they charge a lot of fee.
High transaction fees also plague bitcoin and ethereum blockchains, driven up in part to their increasing popularity.
Stellar set out to standardize transaction costs, as each way lumens are sent or received, the cost is 0.000001 XLM. Keeping transaction costs at mere cents on the dollar equivalent is how Stellar hopes to achieve mass adoption.
Is there a fixed supply of Stellar coins?
The basic tenet of economics, supply and demand, are important to crypto valuation and Stellar is no different.
There were 100 billion lumens available at the 2015 launch of the Stellar network. The supply was reduced in half by the Stellar Development Foundation, also known as SDF, and currently there are 20.7 billion XLM in circulation.
The SDF last year announced it would ‘burn’ half of the supply. By holding back the supply, they are increasing the value.
How secure is the Stellar Network
I don’t want to get too technical. Let’s just say it’s nearly impossible for a single node, or computer, running the protocol to overrule a transaction. Each transaction must be verified by the majority of the nodes.
That means it’s nearly impossible to hack.