What is Stellar (XLM)?

Deep Dive

1. Purpose & Value Proposition

Stellar exists to connect the world’s financial systems. Its core mission is to make cross-border payments and currency exchanges faster, cheaper, and more accessible (CoinMarketCap). Unlike aiming to be a standalone currency, the network functions as a settlement layer where financial institutions and “anchors” (trusted entities) can issue and exchange tokenized versions of assets.

2. Technology & Architecture

The network is secured by the Stellar Consensus Protocol (SCP), a model based on “Proof-of-Agreement.” Validators, which are publicly identifiable organizations, cooperate to confirm transactions in 3–5 seconds without the energy consumption of mining (CoinMarketCap). The native token, Lumens (XLM), is required to pay minimal transaction fees (0.00001 XLM) and acts as a bridge currency in multi-asset trades.

3. Ecosystem & Key Differentiators

Stellar has become a preferred platform for real-world asset (RWA) tokenization. Institutions like Franklin Templeton use it to tokenize money-market funds, and partnerships with Visa and Circle support stablecoin settlements (Scopuly). Its smart contract platform, Soroban, extends its capabilities for decentralized finance (DeFi) while maintaining low costs and speed.

Conclusion

Stellar is fundamentally a blockchain infrastructure project focused on bridging traditional finance with digital asset innovation. As institutional tokenization grows, how will Stellar's role as a compliant settlement layer evolve?