Stellar is pretty hot new thing on cryptocurrencies market and many people are sure that it have potential to became something big. It is a distributed cryptocurrency based on hybrid blockchain, fully opened-sourced, developed with the main idea to improve the cross asset transfers of value, including payments and to provide low-cost financial services to a global base of individuals. Stellar is the network and it is backed by the non-profit foundation known as Stellar Development Foundation. So, let\'s make the things clear, Stellar is network, its cryptocurrency is called Lumen and it is represented as XLM.What is the principle behind Stellar Lumen?
Just like almost every cryptocurrencies, Stellar Lumens is based on blockchain technology. This means that it runs on a connection of decentralized servers, which is supported by the consensus between entities and individuals within the network. These servers are responsible for supporting distributed ledger with the recorded transactions and data. Many people are comparing Stellar to PayPal because you need to upload funds to an anchor on the network and only then you are able to use Stellar initially.The Multi-Currency Transaction nature of the Stellar Lumen
Making transfers across the border is the main Stellar purpose. The network carries one of the following when a currency transfer request is done.
- Stellar have its own order book which is used to changes the funds and accelerates the exchange
- Stellar is using its cryptocurrency XLM as a arbitrator for the exchange which means that it exchanges the funds from the currency into its coin and then the coin into another currency.
- When there is situation that there are no trading pairs exist for the two currencies, stellar looks for offers within the network to exchange a chain conversion into the choice currencies, for example EUR to GBR, USD to EUR, AUD to JPY, BGP to AUD.