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Coin Review: Stellar Lumens (XLM)

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General Overview:


Stellar Lumens is a peer-to-peer cryptocurrency and open source protocol for value exchange. Coins are “pre-mined” and the transfer of coins is based on an open source consensus algorithm, not managed by any central authority. The Stellar Network was first released on July 31, 2014 by Joyce Kim via GitHub and went live August 2014. Stellar was inspired by, and is fork of, Ripple (XRP). After the fork of Ripple, Stellar’s coding was extremely similar until April 2015 when an upgraded code was released with an entirely new consensus algorithm (SCP). Stellar is a not-for-profit organization aiming to promote financial inclusion for the world’s unbanked and underbanked population.

Technology:

Stellar’s network uses the Stellar Consensus Protocol (SCP). The SCP was created by a Stanford Professor named David Mazieres (hired as a consultant for Stellar). In his white paper, Mazieres claims,

“SCP is the first provably safe consensus mechanism to enjoy four key properties simultaneously:

— Decentralized control. Anyone is able to participate and no central authority dictates whose approval is required for consensus.

— Low latency. In practice, nodes can reach consensus at timescales humans expect for web or payment transactions—i.e., a few seconds at most.

— Flexible trust. Users have the freedom to trust any combination of parties they see fit. For example, a small non-profit may play a key role in keeping much larger institutions honest.

— Asymptotic security. Safety rests on digital signatures and hash families whose parameters can realistically be tuned to protect against adversaries with unimaginably vast computing power.”
 

What is Lumens (XLM):

Built-in to the procol are native assets, called Lumens. Stellar Lumens can be used to transact value back and forth. The Stellar network, like Ethereum, can support custom tokens. SCP has a built-in decentralized exchange where assets can be exchanged for different assets based on orders in the decentralized orderbook. Lumens, then, are used for the transaction fees and act as an trading bridge for low volume currency pairs.

Roadmap Review:

For 2018, Stellar has relayed two major goals on their roadmap:

Goal #1 is the release of the SDEX (Stellar Decentralized Exchange)

Described in an article posted on Stellar.org,

“SDEX will be the world-class front-end that our underlying technology has long deserved. It will enable on-chain, protocol-level trades for any Stellar token, and we will create liquidity to minimize spreads and maximize choice of assets.”

The creation of this exchange will further incentivise new ICO’s to use the Stellar network and also promote Stellar’s vision of moving real world assets on to the blockchain.

Goal #2 is the introduction of the Lightning Network

Due to the market demand for more private channel transactions, Stellar has decided to implement the Lightning Network in 2018. Already one of the fastest and cheapest payment systems, the Lightning Network will offer Stellar an even greater advantage over competitors and looks to have a positive effect on Stellar’s long-term security and scalability.

Other Goals

In 2018, Stellar looks to continue pushing toward a more secure and decentralized protocol. In the roadmap, the team claims it wants to make it easier to run a full validator, with less overhead costs. With various performance improvements, the Stellar team wants to make sure the protocol stays resilient and secure by implementing invariant support with checks performed constantly by the validator. As well as focusing on safety and decentralization, the Stellar team also hopes to bring more developers and entrepreneurs to their network through better brand communication, more implementation walk throughs and continued improvement to the Horizon API and surrounding SDK’s.

 

Dev Team:
 

Joyce Kim- Co-founder of Stellar, formerly a VC at Freestyle Capital.

Jed McCaleb- Co-founder of Stellar Development Foundation.Co-founder of Ripple, creator of Mt. Gox and creator of eDonkey2000.

Greg Brockman- Former CTO of Stripe, studied math at Harvard and computer science at MIT.

Keith Rabois- Former senior executive at Paypal, COO at Square, VP of business development at LinkedIn.

Shivani Siroya- CEO of InVenture and 2013 TED Fellow

Wallets: Astral, Lobstr, Ledger Nano S
Exchanges: Upbit, Binance, Poloniex, Bittrex, Kraken

Sources:

Stellar.org
https://emptybucket.co.uk/the-next-bitcoin/

http://storeofvalueblog.com/posts/stellar-lumens-what-is-it-and-should-you-invest/