The blockchain technology came to revolutionize the financial system. While Bitcoin (BTC) introduced decentralization and promised a new era without centralized authorities, it has struggled with achieving faster transaction settlements and scalability. However, the introduction of altcoins like Stellar (XLM) and Ripple (XRP) redefined the blockchain to achieve a lot more than what Bitcoin was capable of.
Ripple has grown over the years to become the third largest cryptocurrency project in the market boating of a market capitalization of $10 billion. The platform was from its inception designed for enterprise use. The official token, XRP currently offers banks and other digital payment providers of cross-border payment services that are real-time, reliable and on-demand. The platform has developed solutions that help banks source liquidity on instant demand while at the same time, eliminating the need to pre-fund nostro accounts.
Payment providers around the globe have been attracted to XRP for their desire to expand and increase influence in new markets. Moreover, XRP offers transfers that are cheap, reliable and fast. XRP transactions settle in 4 seconds compared to Ethereum (ETH) 2+ minutes while Bitcoin (BTC) 1+ hours. On the other hand, the traditional cross-border transfers in the financial system take up 3-5 days to process a transaction in completion. In addition to that XRP is significantly scalable with the ability to comfortably support 1,500 transactions per second (TPS).
Ripple’s xRapid, xCurrent and RippleNet payment solution networks have been a game changer in the fund transfer avenue. RippleNet promises banks and other payment providers “One frictionless experience to send money globally.” It executes on Ripple’s advanced blockchain technology and supports payments using XRP. At the moment the service has over 100 customers and more than 75 that are making commercial deployments. RippleNet has partnered with MUFG Bank, Santander, Standard Chartered, MoneyGram, American Express and many others.
Stellar, on the other hand, is a rising star in the cryptocurrency industry. Besides, the platform has committed to ensuring that cross-border payments are seamless and quick and affordable. Stellar is the 6th largest digital asset in the market with a cap of $3.6 billion. The platform was started by one of Ripple’s founders, Jed McCaleb in 2013. The rivalry between the two cryptocurrency giants started a long time ago.
Just like Ripple, Stellar is a platform that connects banks, payments system, and ordinary people. It achieves this by ensuring that funds are transferred at a minimal cost, fast and reliable. Stellar has become the future of banking through mobile solutions such as mobile money branches, micropayments. The platform exists to connect people to financial services and especially societies that are unbanked. XLM is able to “Facilitate low-cost payments between different currencies.” Stellar’s transactions settle in 2-5 seconds in addition to high scalability levels.
The Battle in 2018
Ripple (XRP) is much bigger than its rival not only in adoption but also in market capitalization. The network has signed hundreds of partnership deals with banks and payment institutions. In addition to that, Ripple’s presence in India’s cryptocurrency market continues to grow (currently over 50%). This can be attributed to the significant head start Ripple had. However, Stellar is coming up with a force of reckoning especially with the notable partnership with IBM. Similarly, it is marketing itself as a better and affordable alternative to Ethereum in terms of payments and development.