In this post I will make a review of The Stellar Lumens Project. I will try to explain everything that i know about it.  I wish to explain it  like i wanted to present you the “Stellar For Dummies” Article.  In this post i will write about Stellar Lumens beginnings, the project, backgrounds, advantages, the future, partnerships, developements, what’s the purpose of Stellar, why was Stellar created and a lot more.

What is Stellar?

Stellar is a financial platform that uses cryptocurrencies and it’s one of the leading cryptocurrencies in the marketThe native currency is called XLM. It has near instant and almost free transactions. It’s used mainly for fast and secure crossborder payments, spam protections in terms of transaction fees and a minimum of account balances. It’s also used as a bridge currency. If you want to convert from one FIAT currency to another FIAT, for example USD to Japanese Yen,  you can use XLM as a bridge currency for that trade. Currently it’s worth around 0.10 cents (USD) which is very attractive price based on the potential of this coin. Despite the bear market in the 2018 Stellar Lumens was one of the most stable coins in the market. The transatction speed is  2-5 seconds. A fee of 0.00001 Lumens is charged for every single transaction. Stellar Consensus Protocol can currently process more than 1000 transaction per second.


Photo from Pixabay, edited on the – Photo Editor

The Beginning Of The Project

The project started back in 2014 and it’s the product of a crypto genius Jeb McCaleb. McCaleb was one of the first crypto pioneers and he cofounded Stellar and OpenCoin which was later rebranded into Ripple (XRP). He even founded eDonkey and the first bitcoin exchange Mt.Gox exchange and he sold it. After he sold it he was concerned about suspicious activities going on there, but he wasn’t in charge anymore to prevent the Mt.Gox collapse. His passion is cryptography. McCaleb wanted to create an open source per-to-per network that couldn’t be controlled by a company. People at Ripple didn’t agree so McCaleb left Ripple and created Stellar Lumens. It was forked from Ripple Protocol and it was re-coded from a scratch with some significant  differences. The main difference is that Ripple (XRP) is trying to serve banking system and Stellar is trying to serve both people and the banks.

Stellar Vision

Stellar vision is to expend  financial acess and payment transactions worldwide. It is a platform that connects banks, payment systems and most importantly people. Stellar connects people to low cost financial services to fight poverty and to develope individual potential by moving money quickly, reliably and with almost no cost.


Photo from Pixabay

Stellar Lumens is creating an open financial sistem and creating tools for anyone at any level of the economy, They are trying to focus on helping the unbank like Africa, Fillipines and other worlds poorest people. So that people who can’t afford or access the modern banking system can create their own bank account, create transfers. But much faster, cheaper and easier.

The Stellar Development Foundation (SDF) is a non-profit organization. It was created to develope a unique Stellar Consensus Protocol which allows them to have a more decentralized network. Stellar used Ripple Consensus Protocol before the Stellar Network gave opportunity to build the new protocol which is now called Stellar Consensus Protocol. 

Stellar is completly open source. Stellar is trying to fascilitate things in more open manner. Stellar is built in with 1% inflation annualy rate. But unlike a bank it prints more XLM and distributes to XLM holders.

Federated Byzantine Agreement

The Stellar Development Foundation with the help of Stanford University profesor David Mazieres created an updated version  of The Protocol with the new consensus algorithm called Federated Byzantine Agreement (FBA). Which is based on entirely new code. The code and the white paper for this new algorithm were released in April 2015 and the upgraded network went live in November 2015. The Federated Byzantine Agreement  allows anyone to choose  which nodes to trust.  Because anyone can run a validated node and you can choose your own people to trust and the Stellar Consensus Protocol is still able to function and create a consensus across entire network.

The general idea is that every person in general is responsable for their own chain and distributed messages as they come to establish in the truth. In Stellar anyone can become a validator  as choose to which validator to trust.

Stellar Decentralized Exchange 

The Stellar network also acts as decentralized distributed exchange and supports any type of assets added by the people. The ledger stores balance held by users accounts and offers to users buy and sell assets. There are many different aditional features of Stellar DEX such as offers, order books, passive offers, cross assets payments and prefered currency.

Stellar has a very interesting setup to be a decentralized exchange and it’s very versatile at that. It gives immediately liquidity without the need to seek a third party exchange. If we consider how expensive can be to list  coins on the major exchanges,  Stellar DEX found a solution for that. Any type of asset can be put on network. In order to cashout of this peggs you have to go through what they call an anchors. Anchors are technically money dealers and they have to be registered and licensed in whatever jurisdiction  they are operating. So Stellar itself is providing the infrastructure.

Stellar is showing their desire  to facilitate the swapping of value of any type of value holder in anyother type of value holder. Making them an ideal payment rail  solution. Because allowing anyone to pay or to get paid with whatever type of value they want. One of the main reasons they are doing this is by building decentralized exchange into the fabric of blockchain itself you don’t need to create a DEX (decentralized exchange) that uses Stellar. Because Stellar is a DEX and you can just build a front-end on. That’s exactly what Stellar X is.



Software giant IBM is probably the most famous company that decided to work with Stellar. IBM official announced collaboration in October 2017. Lightyear (a commercial endeavor building on the Stellar network) partnered with IBM to launch blockchain banking in the South Pacific using Stellar’s lumen currency.

Jed McCaleb said, “IBM’s implementation of the Stellar protocol has the potential to change the way money is moved around the world, helping to drastically improve international transactions and advancing financial inclusion in developing nations.”


IBM announced partnership with Stronghold, the first digital currency backed by the USD and issued and traded on the Stellar Network. Jed McCaleb said that the Stronghold USD Anchor  is the cornerstone piece of bridging the Stellar Network to mass market adoption. Instead of competing with a huge and a powerful financial institutions, Stellar includes them with Stronghold in a productive way. The Stronghold asset already has a major usability  on IBM blockchain applications. The stability it brings will allow the big name players to make transactions comfortably. What’s interesting is that IBM is theoreticaly a competitor to Stellar, giving that IBM has been developing it’s own blockchain technology  for years. However IBM has aproached to this technology with an open-sourced mindset and it’s been more willing to collaborate  with others in order to gain crossborder payments by using the blockchain technology. IBM is working with the large number of major banks in the South Pacific Region.


On July 12 Stellar announed partnership with the money transfer remittance company called Tempo. Tempo money transfer is a well established and you can think of them as a “European Western Union”. Tempo used to have fees cost from 4-150 eur per transaction. Now, with Stellar they save a lot of money. They can make 60k transfers for less than a penny. In the future We can expect a lot more companies to join Stellar because it’s ano brainer. So cheaper, faster and more effective.


Stellar partnered with Deloitte in 2016. At the time of the announcement the consulting firm stated that it aims to help ?tackle (6:10) the everyday challenges that digital banking currently has. It is important to notice that Deloitte was among the first companies to truly begin experimenting with blockchain technologies and it is partnered with a large number of companies to pilot Stellar project. Deloitte lowered transaction costs by 40%. Transactions need less than 5 seconds to validate.


The industrial Credit and Investment Corporation of India (ICICI) is a sub-bank and a financial providers in India.  In 2016 Stellar and ICICI announced partnership that will be processed on the Stellar blockchain network with improved speed and efficiency It was also suggested at that time the mobile wallet application was being developed by the Stellar for the consumers. 


Stripe was the first organization that has adopted Stellar. Stripe announced their philosophy in a blog post, basically it talks about fast cross border payments, an open decentralized and the world’s global network, anchors, federated addresses, in short, it talks all about what Stellar is becoming and adopting into.

Other Partnerships

There is a large list of other Stellars partners and a bussiness providers.  To mention them:  Wanxiang Blockchain Labs,  Factury ( secondary market for loans ),  Bext360 develops technologies ,  Wipro – IT Services, Business and Technology Consulting, ,  Hijro – the financial operating network , Distributed Lab – a crypto & decentralized technology expertise center, Mifos –  platform for  financial services , MONI – providing a ‘banking’ account to every person with a mobile phone, Oradian (Software Provider), Quantoz (Electronic Iot payments), Rehive (wallet as a service ), Telindus (Financial Services), AngloAfrican (Consulting), Poseidon (Trading), SatoshiPay (Nanopayments for Content), Technology Companies  Gramio , NEC , Yinbi , MVP Workshop, Swipe (Financial Technology), TransferTo (mobile payments network), Cellulant payment Service, FlutterWave Digital Payment, Click – Fintech Company, The Bloom Network, SendX and KlickEx payments, Novatti (software technology and payment service, LaLa World – Fintech Company and more…

Photo from Pixabay edited with some of the Stellars Partners


McCaleb negotiated the merger of Lightyear Corp. (Stellar based company) and Chain Inc. creating the new merged entity named InterStellar.

Inter/Stellar Projects

  • Stellar X
  • Sequence
  • Kelp
  • Starlight

Stellar X

They build a completly free to use decentralized exchange ( Stellar X) built on Stellar that allows you to make pegs from almost any type of value you want. It’s the first decentralized crypto platform with global FIAT gateways. now they have a different FIAT currencies, several different crypto currencies. They refund all network cost. It cost you nothing to use, it’s free! They also have built in compliance If you so choose as token issuer which you can do on Stellar, you can issue new tokens, you can do ICOs, you can build Dapps, you can run DEX-es. One of the reasons why people would choose to issue Stellar tokens is that if you so choose you can make your token KYC friendly and compliant and that way if regulators decide to step in you can pass the regulations easily. They are all identified and built in the Stellar Protocol. You don’t need to build the custom tools to make your coin regulation friendly.


Sequence is a ledger-as-a-service that enables organizations to securely track and transfer balances in a token format.


Kelp is a free, customizable, open-source trading bot for the Stellar universal marketplace.”


A new lightning network payment solution within Stellar Network. Essentially how this works is normally when you make payments on Stellar (which are very fast 2-3 sec confirmations). If that’s not fast enough for you there is also Starlight which essentialy works like a checking account. You can lock-up a certain amount of funds and then it’s in your Starlight’s Lightening account. As soon as those funds are locked up they can be used in payment channels and those payment channels are instant and free. So you have instant confirmation. It’s completly free. There is no transaction cost.

Photo from Pixabay

Final Thoughts

Stellar is taking the right actions and could well be on it’s way to mass adoption. They have a really strong team. They have made quite a bit of progress so far. It’s interesting that the one of the most known exchanges Coinbase preffers Stellar Lumens over XRP. Coinbase once stated that they won’t list XRP anytime soon but they listed XLM. Is there some kind of rivality? Maybe! I think many other companies will start to use Stellar because it drastically reduces costs, makes transactions really fast and it’s a modern way of making our lifes much more easier. For the majority of the world’s population, the blockchain is still an undiscovered space. But in the next years the mass adoption is unavoidable. Just because it brings so many benefits that many can’t resist. They just need to discover the blockchain. But this will happen sooner than later. Many companies already started the adoption. When the others  see a competition using it and making an advantage they will need to considered it or they will risk to stay way behind the current times. and behind the progress. There is many crypto projects to choose. It only depends which crypto project suits your needs the most. The Stellar Lumens has some unique features, it’s one of the best crypto projects in my opinion. It has years of development behind it which is an advantage, it has a mastermind genius working on the project and because of that it will probably be very used and adopted in the future.

Disclaimer: This is only my opinion and it’s not a financial advice! Crypto Trading can be very risky! Be very carefull when trading!

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  1. James Diegel

    Very comprehensive and containing quite a bit of useful information. And for sure, Stellar has a bright path forward with all the partnerships and starlight network progressions. Like you hint, with many of the unbanked yet to discover crypto, it will be interesting to see how a project geared towards these very people will evolve. Nicely done CompilationChannel 😉

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