Stellar – a platform that connects banks, payments and people

Stellar – a platform that connects banks, payments and people

Stellar is a platform that was founded back in 2014 to enable people and institutions transact money across currencies and borders at a very low cost.

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Stellar is a platform that was founded back in 2014 to enable people and institutions transact money across currencies and borders at a very low cost. The platform is meant to enable people in developing countries to transact money internationally at low rates. Lumen, abbreviated XLM, is the cryptocurrency used on the Stellar platform. Just like bitcoins, lumens can only be transacted on the internet but not held physically like a dollar.

Lumens are built into the Stellar network, and the value of the lumen shifts from time to time. It is possible to purchase lumens as a store of money. This can be done on certain markets and financial exchanges. However, it is important to know that there are risks of losing your money completely if the network breaks down. Just like other crypto currencies, the value of the lumen is never steady and can result in great loss. On the flip side, it can result in great profits.

To own an account in the Stellar platform, one needs to hold an amount of money, currently set at 20 XLM. This money ensures that all accounts are functional and real.

Financial transactions are the main purpose of the system. With a single lumen, one can afford to make 100,000 financial transactions. In other words, it costs 0.00001 XLM to make a transaction of whatever amount. Using lumens, sending money is as easy and fast as sending a WatsApp message, and costs just as much. Since Stellar is a non-profit institution, this fee is only meant to prevent spammers from flooding the platform. It is usually taken back to the currency pool and contributes to the inflation of the lumen.

The lumen makes it easy to transact on different currencies, especially those of the developing countries. Such currencies lack a large enough market to make it possible to transact cheaply.

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