Who: (Who) Stellar is a decentralized public blockchain network managed by the non-profit Stellar Development Foundation (SDF), founded in 2014 by Jed McCaleb and Joyce Kim.
What: (What) Stellar aims to function as a network for fast, reliable and affordable cross-border payments. Unlike traditional financial systems, Stellar can process transactions in seconds and operates with minimal fees. It also provides a platform for tokenization, allowing assets to be represented digitally. This makes it possible to create digital representations of real-world assets such as securities, real estate, and even loyalty programs.
When: (When) Stellar was founded in 2014. In the same year, the cryptocurrency named Lumen (XLM) was launched.
Where: (Where) Since Stellar is a decentralized network, it is not tied to any physical location. It can be accessed from anywhere in the world and is operated by a distributed computer network. This ensures the network is censorship-resistant and reduces the risk of a single point of failure.
Why: Stellar offers advantages over traditional financial systems for several reasons:
Speed: Stellar can process transactions in seconds, while traditional interbank transfers can take days.
Cost: Stellar transactions operate with minimal fees, avoiding high fees for international transfers.
Accessibility: Stellar offers access to financial services to people without bank accounts.
Security: Stellar uses a star-based consensus mechanism to provide a secure and transparent network.
How: (How) Stellar uses a star-based consensus mechanism to verify transactions and secure the network. In this mechanism, each node (computer) participating in the network votes on whether a transaction is valid or not. Once enough nodes confirm the transaction, the transaction is added to the network.
Additionally: (Additionally)
XLM tokens are used to pay transaction fees on the Stellar network.
Stellar provides tools and resources for developers to build applications on the blockchain. (Like smart contracts)
Stellar provides a platform for institutions to tokenize their own assets. This allows companies to create new investment opportunities and reduce costs.