Which is the best blockchain – CryptoMode

Traditional finance was blown apart when Bitcoin emerged in 2009, leading to a wave of other blockchains and projects trying to find unique ways to change the face of the financial industry. Two of these exciting financial solutions are Stella and Ripple, which are usually grouped together – but is this completely accurate? Through this article, we will take a quick look at Stellar and Ripple and find out if there is a winner.

What is Stellar?

Stellar was introduced by Jed McCaleb in 2014 – after helping launch Ripple. The Stellar Development Foundation is responsible for running the service, and it operates as a non-profit organization – otherwise that would defeat the point of decentralized networks. The native currency of this blockchain is Stella Lumens (XLM) and the main goal is pretty much the same as Ripple – to make money transfers cheaper and faster.

Stellar operates using Stellar Consensus Protocol (SCP), which does not involve large energy consumption caused by mining. This operational technique means that a large number of transactions can be handled simultaneously and at a lower cost.

Stell Lumens is a very recognized blockchain project in the crypto market and it is well worth investing in. If you are interested, check it out CryptoEQ’s Stellar Report.

Who uses Stellar?

Anyone who wants to make fast and cheap transactions, regardless of international borders, can use the Stellar platform. In addition, developers who want to build lending platforms, digital wallets and payment processors can do so using the Stellar blockchain, which is open source.

The platform itself works like SWIFT, but uses XLM as an intermediary instead of USD. Using a native coin, the platform can process transactions lightning fast, and it only costs 0.00001XLM to perform transactions. In case you were wondering, this is only a fraction of a dollar, which is an absolute steal.

Stellar’s target audience is the average user, unlike big banks. In particular, it works hard to provide financial solutions to developing countries. When Stellar calls itself a not-for-profit organization, it means that its goal is to provide help rather than make money.

What is Ripple?

Ripple was introduced in 2013 under the name “Ripplepay”, back when blockchain technology had only been around for five years. The name change came from a sale, where the platform was led by Arthur Britto, David Schwartz and Jed McCaleb, who drove the platform to become an open ledger for the financial industry.

Ripple is a private company built using the Ripple Protocol Consensus Algorithm (RPCA), which was used to establish “Internet of value” – as it is known now. The main goal of Ripple has always been to make life easier for people who send money around the world.

The original coin for Ripple is XRP, and there are NOK 100 billion. The decentralized nature of Ripple allows it to eliminate the middleman, making it a much cheaper option for sending currencies internationally. Eventually, Ripple aims to be a trusted ledger that supports any currency.

Who is Ripple used by?

Anyone can use Ripple, whether for personal or business use. For example, companies can leverage Ripple as an efficient way to pay salaries for foreign employees – without having to pay high conversion and processing fees. By targeting a competitor, Ripple is targeting SWIFT, which allows cheaper bank transfers – the goal here is to promote a faster transaction (seconds).

Ripple has already seen wide adoption, with banking giants American Express, Santander and UBS already using Ripple; several banks are testing the service. In addition to this, Ripple has partnered with alternative payment services including Western Union and MoneyGram.

Important differences

Stellar and Ripple are two highly efficient blockchains with subtle differences, but here are some examples for you:

• Both networks reward validators with native coins (XRP or XLM depending on the chain).
• Stellar allows anyone to build on top of it, while Ripple is an independent platform.
• Stellar targets individuals while Ripple tries to work with financial institutions.
• Both blockchains avoid mining and high energy consumption, but have different consensus mechanisms.
• Stellar is a non-profit entity, while Ripple is a private company.

The decision

Stellar and Ripple both aim to solve problems around international payments and high transaction speeds/costs, but they approach them in different ways. Stellar has more potential in terms of use cases, as anyone can leverage the network to build applications. However, Ripple will probably feel safer with the banks because they have already brought a small number. Deciding on a clear winner is almost impossible, as they both appeal to different audiences. At the end of the day, the blockchain you choose to support will depend on your own motivations and goals – more research will help you come to a conclusion.

None of the information on this website is investment or financial advice and does not necessarily reflect the views of CryptoMode or the author. CryptoMode is not responsible for any financial losses incurred by acting on information provided on this website by its authors or customers. Always do your research before making any financial commitments, especially with third-party reviews, pre-sales and other opportunities.