What is Stellar?
El decentralized open source protocol STellar (XLM), Allows you to perform transfers of cryptocurrencies, to fiat and vice versa. The purpose of this is to allow easy, fast and secure cross-border transactions between any pair of currencies. The development of this protocol is supported by a non-profit organization called Stellar Development Foundation. Its monetary unit is called Lumen, and is the native cryptoactive of this network.
This blockchain unlike that of Bitcoin, is not designed to be used as a means of direct payment. Rather It is designed to be an intermediary in currency conversion. In this sense, it seeks to become a system that compete directly with Ripple (XRP). In parallel, the Lumen is a cryptocurrency not mineable, and 100.000 billion tokens were created in its beginnings. These tokens are in the hands of the Stellar Development Foundation. This foundation has the mission of distributing 95% of the tokens. Divided between; random people (50%), companies or organizations of the ecosystem (25%), bitcoin holders o Ripple (twenty%). The remaining 20% are reserved to maintain its operating costs. and continue its development.
Beginnings of the Stellar Project
The beginning of this adventure lead us to Jed McCaleb, founder of the exchange Mt. Gox and co-founder of Ripple. He with the lawyer Joyce kim, launched the project in 2014. A short time later, the Stellar Development Foundation, In collaboration with Patrick Collison. Collinson is the Stripe CEO, a company that develops an electronic payment system. Finally in July 2014, it was officially launched Stellar, with Stripe's initial investment of $ 3 million.
In order to raise funds for development, the project launched a ICO (Initial Coin Offering). During this ICO they managed to raise $ 39 million and were deployed 100 billion lumens. After the success of this ICO, Market Bitcoin, a Brazilian exchange announced its adoption in August 2014. Subsequently, other exchanges began accepting the cryptocurrency on their platforms.
By January 2015, there were already approximately 300 thousand user accounts registered on its platform. In addition, its market capitalization exceeded $ 15 million. In November 2015, Stellar Development Foundation released a new network update. In this update the new consensus protocol called SCP (Stellar Consensus Protocol). This was created by the teacher David mazières of the Stanford University. It was completely different from any other protocol known as PoS o PoW and provides unique features.
In May 2017, the company's commercial arm was launched, its website and official name was Lightyear. In September 2017, a scholarship program was announced, which is part of its Stellar Association Scholarship Program. Through it, partners would be awarded up to $ 2 million in lumens for project development. In September 2018, Lightyear Corporation acquired Chain, Inc. and the combined company was renamed I.
Today it is one of the fastest growing platforms in the blockchain financial world, also having a continuous evolution of its technology.
Stellar technical characteristics
Like almost all projects open source of cryptocurrencies, Stellar has its main repository hosted at GitHub. From there we can have access to all the parts that make up the project. The bases of its protocol, operating core, clients, SDK, Docker package ... make up a total of more than 90 different projects. All of them under license Apache 2.0. In this way, the project guarantees that the code can be used in community or private projects.
These projects are mostly created in different programming languages. Among them we can mention the use of C++ (in its C ++ 14 standard), Go, Python, Java, JS, Ruby and Shell. This means that there is a large development ecosystem. All this benefiting from a common software core.
But the most impressive thing about Stellar is his own contributions to blockchain technology. Among them we can highlight the following:
Stellar Consensus Protocol - SCP
Stellar Consensum Protocol (SCP) is the consensus protocol created specifically for this network. SCP uses a type scheme Federated Byzantine Agreement (FBA).
SCP's operation is detailed in the whitepaper released by the Stellar Development Foundation. In it, they explain how the SCP derived from the concept of FBAs, and adapted to a decentralized and permissionless network using quorum and quorum segments.
For the FBAs to function properly, participants must wait for the majority to reach a consensus. In this way, participants know which transactions are most relevant before starting to settle them. So when the majority of the network takes a position, the network accepts the transaction and makes it unfeasible to roll it back for an attacker. Only then do participants consider the transactions settled. In doing so, the FBA consensus can guarantee the integrity of a financial network. And in parallel, it guarantees their decentralized control and the organic growth of it.
FBAs give SCP great reliability and a series of unique characteristics, among which are:
- Decentralized control. Anyone can participate and there is no authority central. Approvals in the network require a consensus of the same.
- Low latency. The nodes. they can reach a consensus on the deadlines humans expect for web or payment transactions. This means that; it only takes a few seconds at most to reach a unanimous consensus.
- Flexible trust. Users are free to trust any combination of parts they deem appropriate.
- Asymptotic security. Security is based on digital signatures and hash families. These parameters can be realistically adjusted. With this system, 51% attacks are avoided.
Horizon - An API to handle everything
As previously mentioned, Stellar has a fairly cohesive working core. But to achieve this, its developers have created Horizon. This is a module created to work as a web service, by which most applications can interact with the network. This creates a stable and concise environment to link the different applications so that they interact with the network using Horizon as an intermediary.
In this way, Horizon offers an easy way to send transactions, verify accounts and subscribe to events. Use of El Horizon gives Stellar a lot of flexibility, to the point where using a web browser (Firefox or Chrome) we can directly interact with the network. Additionally. interfaces on Horizon can be designed very quickly and easily. This offers unmatched ease and flexibility in developing systems. So it is very easy to add new features allowing Stellar to grow with the push of his community. A situation that benefits Stellar, as it promotes its expansion and greatly facilitates the deployment and development of compatible systems. All this using tools that maintain compatibility with its development core.
This makes it possible to use embedded systems in electronic devices that interact with the network, and allow us to make use of it. For example, embedding a Stellar node inside a Smart TV and from there being able to access network functions. This demonstrates the potential of technology and the ease of providing access to it.
Stellar Core - The core of the Stellar network
Each Horizon server, connects to a Stellar Core, which is the backbone of the network. El Stellar Core is in charge of decentralizing the network services, and at the same time guarantees their correct operation. In this way, the network becomes a collection of interconnected Stellar Cores, managed by different individuals and entities around the world.
The functions of these are as follows
- Guarantee the stability and decentralized operation of the network.
- Be responsible for the connection between the different services on the network. These services may be provided by Horizon or other Stellar Core.
- Track and control the history and modification of your own blockchain.
- Secure public history of transactions and entries ledger in external permanent storage. This serves for auditing and as a source of recovery data for other nodes.
- Guarantee the hashing and non-duplication of blocks within the network.
- Control the consensus services of your entire network.
Stellar Network - The Cluster of Stellar Cores
Stellar Network is a worldwide collection of Stellar Cores. Each of these Core, are maintained by different people and organizations. The distributed nature of the network makes it reliable and secure. All these nuclei make up the network of nodes, which eventually agree on the sets of transactions. Each transaction on the network costs a small fee: 100 stroops (0,00001 XLM). This fee helps prevent spam from being sent to the network by guaranteeing its proper functioning.
What are Lumens?
A lumen is a unit of digital currency, as is the case of bitcoin for the Bitcoin network. The Lumens are the primary and native asset of the Stellar network. They are integrated into the network. Logically, the Lumens can not be held in hand, they are a digital asset, but they are essential for the operation of the Stellar network as they contribute to the ability to transfer money around the world quickly and safely.
When Stellar was launched, the name of their tokens was not Lumen. They were called the same as the network itself. After a year, in 2015, the network was improved and the name was changed to Lumen to differentiate itself from the network and avoid confusion with the name of the foundation.
Why does the Stellar network need Lumens?
Lumens are used online as a tool antispam. Specifically, Lumens are required to make a transaction and avoid accounts with empty balances. In this way, the network is protected, preventing malicious actors from saturating it, with a DoS attack. On the other hand, all accounts require a minimum balance of 0.5 Lumens. In this way users are pushed to keep the blockchain clean with the elimination of abandoned accounts. Consequently, all the accounts that make up this network have an economic profit.