Stellar (XLM) is a blockchain network designed from the ground up for fast, cheap payments and the issuance of digital assets representing real-world currencies. Created by Jed McCaleb (also a co-founder of Ripple/XRP) and Joyce Kim in 2014, Stellar differentiates itself through its unique Federated Byzantine Agreement (FBA) consensus model, which enables 3-5 second transaction finality without proof-of-work mining. The Stellar Development Foundation (SDF) is a nonprofit that stewards the protocol and focuses on financial inclusion — providing banking infrastructure to the unbanked.
| Stat | Value |
|---|---|
| Ticker | XLM |
| Price | $0.16 |
| Market Cap | $5.16B |
| 24h Change | +0.7% |
| Circulating Supply | 33.11B XLM |
| Max Supply | 50001.78B XLM |
| All-Time High | $0.88 |
| Contract (Stellar) | CAS3J7...OWMA |
How It Works
Stellar Consensus Protocol (SCP)
Unlike Bitcoin’s proof-of-work or standard Byzantine fault tolerance, Stellar uses Federated Byzantine Agreement (FBA). Each node defines its own “quorum slice” — a set of nodes it trusts. Consensus is reached when overlapping slices agree, without requiring all nodes to trust the same validators. This architecture enables:
- Transaction finality in 3-5 seconds
- No energy-intensive mining
- Open participation (anyone can run a node)
Anchors and Asset Issuance
Stellar’s key feature is the “anchor” system: licensed financial institutions connect real-world currencies (USD, EUR, etc.) to the Stellar network by issuing tokens redeemable for the real asset. USDC operates on Stellar, as do many other stablecoins and central bank tokens.
Built-in DEX
Stellar has a native decentralized exchange built into the protocol layer, allowing any two assets on Stellar to be swapped directly using an orderbook matching engine.
Tokenomics
| Parameter | Value |
|---|---|
| Total supply | ~50 billion XLM (as of 2024) |
| Original supply | 100 billion |
| Burned in 2019 | ~55B XLM burned, inflation disabled |
| Stellar Development Foundation holds | ~30B XLM for ecosystem development |
| Transaction fee | 0.00001 XLM (100 stroops) |
| Minimum balance | 1 XLM per account (network protection) |
Use Cases
- Cross-border remittances: XLM enables cheap international transfers, especially USD↔local currency corridors
- USDC and stablecoin rail: Circle’s USDC is natively on Stellar; institutions use Stellar for settlement
- Central bank digital currencies (CBDCs): Multiple central banks have piloted Stellar for CBDC infrastructure
- Asset tokenization: Real estate, equity, and commodity tokens issued by anchors
- Native DEX: Atomic swap between any two Stellar assets
History
| Year | Event |
|---|---|
| Jul 2014 | Jed McCaleb and Joyce Kim launch Stellar Network |
| Nov 2014 | Stellar forks away from Ripple’s consensus protocol; SCP introduced |
| 2016 | IBM partners with Stellar for cross-border payments (IBM World Wire) |
| 2018 | IBM World Wire goes live for 72 countries using Stellar |
| Nov 2019 | SDF burns 55 billion XLM (more than half the total supply); removes inflation |
| 2020 | USDC launches on Stellar |
| 2021 | MoneyGram partnership announced (via Galaxy Digital) for XLM on/off ramps |
| 2022 | European Central Bank explores Stellar for CBDC pilot |
| 2023 | Stellar Smart Contracts (Soroban EVM-like layer) enters testnet |
| 2024 | Soroban mainnet launch; Stellar gains smart contract capabilities |
Common Misconceptions
“Stellar and Ripple do the same thing.” Both target payments, but they differ fundamentally. Ripple/XRP targets banks directly via partnerships; Stellar targets developers and financial inclusion via an open protocol. XRP uses a different consensus mechanism and is venture-backed; Stellar is nonprofit-run.
“Jed McCaleb is still running Stellar.” McCaleb stepped back from active Stellar leadership in 2019. Denelle Dixon has served as CEO/Executive Director of the Stellar Development Foundation since 2019.
Criticisms
- SDF holds a large portion of the XLM supply (~30B), which some view as a centralization risk
- The federated trust model means the network’s security depends on the trust graph remaining well-connected; a poorly chosen quorum slice could isolate nodes
- Smart contracts (Soroban) arrived much later than Ethereum competitors, limiting DeFi development
Social Media Sentiment
Stellar’s community is more institutional and enterprise-focused than most crypto projects. XLM holders tend to be patient, long-term oriented, and focused on the financial inclusion narrative. Retail trading activity is lower than comparably ranked coins. Partner announcements (IBM, MoneyGram, CBDC pilots) drive periodic price spikes and media coverage.
Last updated: 2026-04
Related Terms
Sources
Mazières, D. (2016). The Stellar Consensus Protocol: A Federated Model for Internet-Level Consensus. Stellar Development Foundation.
Kim, J., & McCaleb, J. (2014). Stellar Network Launch Announcement. Stellar.org.
IBM. (2018). IBM World Wire: Enabling Real-Time Global Payments Using Blockchain. IBM Research.
Stellar Development Foundation. (2019). November 2019 XLM Burn: SDF Destroys 55 Billion XLM. Stellar.org Blog.
Garcia-Molina, H., & Salem, K. (1987). Sagas. ACM SIGMOD Record (cited for distributed transaction concepts).