Home task week 1- COMPARISON BETWEEN RIPPLE AND STELLAR

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Blockchain technology as we all know has grown to be a major turn around in the world of technology today, and as a result have brought a major improvement in the finance industry.
BlockchainSince the rise of Bitcoin in 2008, the Financial ecosystem has never been the same again, and has improved beyond doubts.
The Blockchain technology has loads of benefits that can bring about major improvement in the business world, the medical world as well as other parastarters, and not limited to exchanging of cryptocurrencies alone.

The Blockchain technology paving the way for the Decentralized Finance system which is unlike the Centralised finance system like banks and etc, the Decentralized Finance Ecosystem is one which is transparent, permission-less, fast, safe, do not have an intermediary, is very trust worthy, and quite efficient to say the least. Because of the Blockchain technology, transaction are done in seamless time without any form of network stalling like experienced in the centralised finance system like banks where some transactions could be delayed for hours or in most cases days due to network down time by operators.

STELLAR

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Stellar Lumens, also known as XLM, although these terms are interchangeable, they such stands for various things, Stellar is the Blockchain network itself, Lumens is the Blockchain native tokens, while the XLM is known as its market abbreviation.
Stellar's primary goal is to breach the gap between cryto-currency and Fiat.

What is Stellar

Stellar is an open source network for storing money and making payments, and was co-founded in 2014 by Jed McCaleb & Joyce Kim and was officially launched in 2015, and even came up before the Ethereum.
Stellar allows it's users to also send euros dollars, yen etc.as well as any other currency to anyone with a Stellar address as well to any part of the world with practically zero fees and in a matter of seconds, and though some other Centralised platform also offers such services, Stellar does it using the blockchain and with high speed and without having to go through special permissions to carry out such transactions, and most importantly Stellar can be used to tokenize any currency in the world, and asides from currencies, anything can be tokenized on Stellar examples are gold, silver shares etc.

Stellar also works hand in hand with some companies which takes responsibility on bridging the gap between the Stellar blockchain and the traditional financial system either by working as fiat or issuing tokens or both, and in exchange for this services, they certainly charge a certain amount of fee, for example Anchor.

Lumens which is the Stellar's native tokens can be used to pay the fees for transacting in the stellar network, and the minimum fee is 0.00001 XLM.
Unlike BTC and some other cryptocurrencies, Stellar Lumen aren't produced or mined, but a total of a 100 Billion were produced upon project launch, with a yearly inflation rate of 1%, but in October 2019, the inflation was removed and the total number of XLM was reduced to slightly above 50 million.

RIPPLE

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Ever been in a situation where you are needed to wire money to someone only to be told it could take a couple of hours or days to complete transaction? and that's because most banking system are still making use of systems that were built over 35 years ago to carry out recent transactions hence the delays at most point, money-Gram, Western Union and swift are just some examples of slow and expensive and relative systems which financial system use to transfer money, and asides from this not all the banks are connected by the same network which causes lengthy processing time in order to get through to another banking network by a particular bank, and that is why international bank transfers are so slow and expensive, and all these mentioned procedures above is exactly what Ripple is here to change.

What is Ripple?

Ripple which is sometimes referred to as XRP is a cryptocurrency under the blockchain network, and as the internet has it own protocol known as "HTTP'' the Ripple also has its which is known as "RTXP" and uses this to move values around the world, and using the Ripplenet, there no need to wait days in order to transfer funds, but can be done in just matter of seconds to anywhere in the world.

The idea for Ripple was first conceived in 2004 by Ryan Forger and was called Ripple-pay, but in 2014 passed through Jed McCaleb and Chris Larsson.
Unlike other Cryptocurrencies which focus on the individual Ripple helps to make banking sectors Carry out most financial transfers at a very minimum cost, ripple base offer businesses an alternative access to the banking system in form of an internet or value called Ripple-net.

Ripple Vs Stellar

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The Ripple and Stellar are both cross border system that wants to facilitate growth in the crypto world, these two are both cryptocurrencies and likewise share the same code base, significantly, Jed McCaleb founder of Stellar network placed a significant part in both projects, and if you are familiar with both projects you would know for sure that they have different targets, Ripple for example targets financial institutions, payment providers etc. while Stellar focused on individuals as well as providing low cost financial services to developing countries, meanwhile Stellar wished to place it network in the hands of people, while Ripple in the hands of financial institution, and neither of both approaches are wrong but will surely improve the financial industry immensely in their both ways.

If you're familiar with Ripple, I'm sure you would have recognised it's X-rapid and X-current terminology, in which the project decided to place both services on a platform which they call the Ripple-Net which is a close source network, and with Ripple-Net, usera have access to on-demand liquidity, global payment, as well as payout options in more than 40 different currencies, and Ripple-Net provides fast, certain, real time and seamless services for its users, and this Decentralized network offers ease of transaction in all ramification, and payment are processed efficiently with prevalidated procedures that in turns lowers the cost of transactions fees unlike the traditional Finance system.

And for comparison sake, the technology behind The Stellar network is open source, and supports thousands of people everyday with its Decentralized network system, and the project allows anyone to settle payment as well as issue assets, Stellar allows it's users to global payment system thereby also giving it's users a major boost to rise above its economy and interact with international markets which ordinarily would be near impossible, and the project makes sure it's users are not limited by their borders.
In addition, Stellar is currency agonostic , which means it will handle any currency as well as Fiat currencies, and it's also cheap which means users will not be scared of heavy transaction fees unlike the Traditional finance ecosystems.

Stellar also let's users interact with one another, with not intermediary to go through first, which also make the platform ownerless meaning it's owned by whoever or anyone who uses it.

Consensus for each project

Ripple uses its XRP consensus protocols which, which it refers to as XRP ledger, and with this ledger anyone who accesses it can view the recent state of the network, as well as any transaction made on the network, and it's Consensus focuses majorly on agreement correctness and forward progress, each service users it's validators to agree on the set of transactions initiated and consensus is achieved if a large amount of the servers agrees on an approved transaction, so long as a minimum of 80% of the validators agrees the consensus moves forward.

Stellar Consensus mechanism is called the SCP, is one that prevent niferous nodes from relaying false information, and SCP helps to achieve consensus without the need of close system transaction.
With the SCP progress on the network stops in the presence of a partition and only resumes from consensus is reached.
The Stellar Consensus mechanism consist of 4 key identifiers, which are a systematic security, flexible trust, Decentralized control as well as low latency.

In Conclusion

Both the Ripple and the Stellar network, though has some differences, but surely have a Major goal together which is to improve financial systems and services, better than the traditional systems which has been in existence before them making transaction less cumbersome, efficient, secure and seamless.

And it's no surprise that the Decentralized Finance system is rapidly taking over the financial ecosystem better than the centralised system of finance ever did, thereby making the financial system easier to use than ever even in the highest levels.