What is Stellar (XLM)?

Deep Dive

1. Purpose & Value Proposition

Stellar’s core mission is to make cross-border payments and asset transfers fast, cheap, and accessible. It targets financial inclusion, particularly in underserved regions, by providing a decentralized platform that connects banks, payment systems, and individuals. The network facilitates the issuance and exchange of digital tokens representing any asset, like currencies or commodities, aiming to reduce the cost and friction of traditional finance.

2. Technology & Architecture

The network operates on the Stellar Consensus Protocol (SCP), a federated Byzantine agreement system. Unlike proof-of-work blockchains, SCP does not require mining, making it energy-efficient. It confirms transactions in 3–5 seconds with minimal fees (0.00001 XLM). The built-in Distributed Exchange (DEX) allows users to trade assets directly on the ledger. Recently, the launch of Soroban, a smart contract platform, has expanded its capabilities for decentralized applications (AmbCrypto).

3. Ecosystem & Key Differentiators

Stellar differentiates itself through deep institutional integration rather than retail speculation. Its ecosystem includes partnerships with entities like Visa for settlement, MoneyGram for remittances, and Franklin Templeton for tokenized funds (Dope Credits). It also aligns with global standards like ISO 20022, enhancing interoperability with traditional finance. A key focus is on real-world asset (RWA) tokenization, hosting billions in tokenized value, which underpins its utility beyond speculative trading.

Conclusion

Stellar is fundamentally a settlement layer for value transfer, distinguished by its enterprise-focused partnerships and efficient core technology. Will its established financial integrations allow it to become a default infrastructure for global asset tokenization?