Stellar Lumen v/s Ripple – Similarities & Differences

Ask a layman about the similarities/difference between Stellar Lumen and Ripple; he may appear lost, haven’t heard these words; but ask him if he has listened to the word Cryptocurrency – it might ring a bell. You shall come across the various cryptocurrencies available at present, two of which are Stellar Lumen and Ripple XRP. Stellar and Ripple are both technologies that allow for the transfer of funds, and Lumen & XRP are their own Cryptocurrencies.


Similarities between Stellar Lumen and Ripple XRP

These cryptocurrencies are developed by the same person – Jed McCaleb! Ripple was created by a team comprising of David Schwartz, Jed McCaleb, and Chris Larsen in 2012, and Jed McCaleb created Stellar Lumens in 2014. Well, that’s not the only similarity between them. Let’s dig deeper, shall we?

The codes used for both technologies are almost similar. They use a distributed ledger protocol for processing transactions, making it slightly difficult to differentiate them and also processing them at lightning speed, which makes both of them suitable for international payments and transfers. Also, unlike Bitcoins, where you have miners, both Stellar and Ripple do not use miners. In Bitcoins, miners are rewarded to motivate them to download the client to their device, which helps in strengthening the network for Bitcoins. Stellar and Ripple, due to the technology users, do not allow the netizens to run the course.



Differences between Stellar Lumen and Ripple XRP

One would indeed say, looking at the similarities, that they are almost a mirror image of each other, but that is so not the case. Albeit they seem similar, they do have attributes that keep them apart. One of the stark differences in the audience for whom these technologies are intended for. Ripple, on the one hand, targets the Banking and Financial Institutions aimed to resolve the issues of liquidity. On the other hand, you have Stellar, which looks towards helping the unbanked populace – particularly those in poorer countries with no access to any of the daily financial services/requirements viz. saving bank accounts, loans, credits, etc. Although both the technologies allow for cheap and faster transfer of money/funds, while dealing in Ripple, institutions have to deal with the high cross-border payments which are absent in Stellar.



Based on the preceding paragraphs, you probably are much clearer about these two technologies, their resultant cryptocurrencies, the technology used, and their similarities and differences. Although similar, Stellar shall appeal to the unbanked while Ripple will continue to attract the Banking & Financial Institutions.