What are the main features of Stellar Lumens’? It is extremely fast, taking only 2-5 seconds to complete the transaction. It is one of the most secure cryptographically. Payments work like emails. Global reach with one integration. How does money move? Let’s take a look in an example: Mr Jeff is a customer at ABC remittance, an American-based company. Mr. John is a client of a local bank in Nigeria. Mr. Jeff frequently sends money to Mr. John in Nigeria. Stellar, as mentioned, is an open platform that connects banks, payment systems, people, and other institutions. Stellar allows them to transfer money instantly through integrations with the ABC remittance service and the local Nigerian bank.
Stellar Role
Stellar’s role is now clear. When Mr. Jeff transfers $200 via his payment company’s app, it transfers a message immediately to a regional Nigerian bank to verify that Mr. John is compliant. ABC payment company, which is an anchor on a stellar network and can receive deposits and distribute credits through the stellar network, deducts the funds from Mr. Jeff’s personal account.
These funds are transferred to ABC’s pool account. Then, they are transferred to stellar by assigning credits to Mr. Jeff’s dollars on the network. Once ABC’s credits have been added to the stellar network, it will search for the best exchange rates from all the market makers. Now the exchange is complete and Mr. John from Nigeria has access to his base account at the local bank. These digital credits are accepted by the local bank for Mr. John via the stellar network. The local bank credits Mr. John with digital credits. This is how 1 US Dollar can be converted to any of 180 currencies via stellar. It takes five seconds to move and costs a fraction of cent.
Felhasználási esetek
Praekelt Foundation: Praekelt Foundation, an African non-profit company that uses mobile technology to improve lives of those living in poverty, is called the Praekelt Foundation.
- TEMPO: TEMPO provides fast and secure online money transfer services. TEMPO also integrated with stellar to make transfers from Europe to the Philippines more efficient, cheaper, and more reliable.
- Parkway: Parkway, a mobile money operator, uses the Stellar network to link Nigeria’s five main telcos. It is possible for clients of different MM services to transfer money between each other because of this. The Praekelt foundation integrated Stellar into Vumi, a messaging app that allows young girls from Sub-Saharan Africa save money on airtime credits.
- Deloitte: Deloitte ranks among the top four accounting firms in the world based on income. This economic solution is used across 30 countries in different sectors, including healthcare, education, energy, and other. Stellar and Deloitte developed a mobile app that made international payments safe and secure. It reduces transfer costs by up to 40% and closes transactions in about 3-5 seconds.
Decentralized
The Stellar network is a distributed network as shown in the above figure. This means that Stellar network is not dependent on any one server. It is important to have as many servers in the network as possible so that the network can still function well even if certain servers fail or are not functioning correctly.
The Stellar ledger, as shown in the above figure, records a complete list of transactions for each account on the network. Every server that hosts the Stellar software stores all global data.
Konszenzus
The above illustration shows how the Stellar servers interact to verify that activities are accurate and precise. The actual financial transaction is completed by the Consensus algorithm.
Anchors
The figure above shows that Anchors accomplish two things. They accept deposits from users and transfer the credit to the Stellar account address. Users can withdraw credit after that.
Distributed Exchange
The stellar network allows users to purchase and trade currencies as if they were foreign currencies. It also converts currencies automatically during transactions, as shown in the above image.
Multi-currency transactions
Stellar allows users to transfer any currency they have to another person in a different currency via the built-in shared currency exchange.
What makes Stellar so special?
Stellar is also a network that uses the same blockchain technology as Bitcoin. Stellar’s transactions are completed in less than 5 seconds, which is a significant improvement over Bitcoin. It allows users to instantly exchange currencies from 180 countries, including U.S. Dollars into euros, and other functions such as converting U.S. dollar into euros. The Stellar network implements all the innovative characteristics of a shared open ledger on a distributed database deemed blockchain technology. Lumens function as an anti-spam agent.
This is a great feature because it stops hackers flooding the network, which is often called a DoS attack. A ledger shows the status of the Stellar network at runtime. The lumens act as a security guard and prevent Dos attacks from taking over large amounts of the ledger. It contains the account and balance lists, all orders in the distributed exchange, as well as any other data. Another amazing thing about Stellar network technology, is that all Stellar accounts must have a minimum balance in the range of 20 lumens. This rule ensures that all accounts on the network have a minimum balance of 20 lumens. The network can then manage a steady and safe flow transaction. Stellar is compliant with regulations, and the network is sound.
Different from Bitcoin
What makes the Stellar Lumens Network different from Bitcoin and other cryptocurrency networks? The answer is the algorithm of Stellar network. These are some of the reasons why there is a difference:
Stellar transactions are quicker than Bitcoin transactions. Because Stellar Lumens uses consensus algorithms, which can be completed quicker than mining, the reason is simple. The Lumens supply increases at a fixed rate of 1% per year. Stellar Lumens charges a lower transaction fee that Bitcoin and other cryptocurrency. This is crucial because it helps in inflation. Users can also use the stellar network to freely trade with cryptocurrency or fiat.
Other cryptocurrencies were not created to be a new currency. Stellar Lumens was designed so that it can be used in all transactions.