You’ve become a crypto gambling pro through the best crypto casino, which inevitably leads to you wanting to brush up on your crypto knowledge! So, let’s talk about Stellar vs Ripple cryptocurrencies. 

The two are incredibly similar, which can confuse them. The two currencies are rivals of sorts. 

Here, we will explore the history of how each came to be. We will then consider how the currencies are similar and how they differ. Finally, we will examine how each performed in the markets this last year.

Stellar vs Ripple: The History

In 2012, Chris Larsen and Jed McCaleb founded Ripple. The idea was to create a blockchain-based solution for cross-border payments between financial institutions, also known as a remittance solution. 

The software technology produced by Ripple is powered by its native cryptocurrency: XRP. XRP currently boasts the seventh-highest market capitalisation of all cryptos. 

Two years later, McCaleb left Ripple and founded Stellar. The reasons for the rift were put down to “differences in opinion.” Stellar also aimed to provide cross-border payment solutions to a different target market. 

The software technology produced by Stellar is powered by Stellar’s native cryptocurrency: Lumens. Lumens, also known as XLM, is currently ranked 14th among all cryptocurrencies. 

What shouldn’t come as a surprise is that Ripple and Stellar solutions feature similar codes. Although, Stellar did revamp its code shortly after launch to better adjust to the new target market. 

Because the two companies have different target markets, the solutions are not direct competitors. That being said, the two are frequently compared because of the similarities in their goals and solutions.

Stellar vs Ripple Philosophies

Ripple set out to solve the many problems associated with cross-border remittance payments between large financial institutions. Cross-border remittance usually involves high costs and long processing times. 

This is because each bank involved in a transfer has long, inefficient procedures associated with processing transfers. Processing involves other third-party institutions, each charging its processing fee. 

Where Ripple technology comes in is it allows banks to communicate with and transfer money between each other without the need for other parties’ involvement.

Cryptocurrency Philosophies

Stellar is a non-profit aiming to help citizens from unbanked or underbanked populations. Visit Stellar’s website, and you will see that the Stellar Development Foundation’s main aim is to “connect people to low-cost financial services to fight poverty and develop individual potential.” Stellar, however, aims to provide ordinary people access to fast, cheap international money transfers.


Technology Similarities Between The Currencies

When looking at technology similarities between Stellar vs Ripple, despite the former’s updated code, there are still many technological similarities shared with the latter.

Ledger Protocols

One of the significant similarities between the two currencies is that both uses distributed ledger technology (DLT)

DLT removes the need for third-party involvement in the processing of fund transactions. This allows transactions to occur in seconds, with processing fees amounting to less than a cent. 

To achieve this, the ledger protocols of both currencies charge a tiny fraction of the coin, e.g., 0.0001 XRP vs 0.001XLM. 

Because both protocols were set up for use in the global payment system, it is in their interest to keep the value of their tokens low. Otherwise, global payments will quickly become too costly.

No Mining

For Bitcoin, people contribute computing power to verify transactions on the blockchain. They are known as miners, and each miner’s computer is called a node. All nodes collectively power the blockchain, ensuring that the currency is decentralised.  

Neither Stellar nor Ripple uses miners/public nodes. They possess and run all the necessary nodes privately across multiple servers. 

Any banks or private organisations utilising either currency can choose whether they want access to the technology required to run nodes. In this way, the currencies remain somewhat decentralised.

Token Circulation

Coin supply and circulation are entirely controlled by Stellar and Ripple developers. Token circulation can be increased whenever each team sees fit. This kind of “centralised” control makes many crypto users wary.

Differences Between The Currencies

Differing Philosophies

As mentioned above, Ripple targets financial institutions, whereas Stellar was created to help people lacking access to critical financial services. Stellar is a non-profit, with plenty of XLMs donated since its inception.

Node Consensus

Node consensus/node agreement is the technology used to validate transactions. A node consensus approach does not require a third-person intermediary, which is why blockchains favour it. 

Two of the most well-known consensus approaches in use include Proof-of-Work, used by Bitcoin, and Proof-of-Stake, used by Dash.   

Stellar vs Ripple employs different consensus approaches. Ripple uses a Proof-of Correctness (POC) node consensus. This POC technology is applied by all network nodes every few seconds to ensure the verification of transactions. 

Stellar uses a consensus technology dubbed the “Stellar Consensus Protocol” (SCP). This approach ensures that all transactions are verified and recorded using a Federated Byzantine Agreement.


Coin Supply

We briefly touched on coin circulation, which the respective coin developers dictate. But coin circulation differs from coin supply, and the two work together to determine the currency’s value. 

For example, Stellar increases XLM inflation by 1% each year in a setup that mimics conventional currencies. This means that inflation will cause the token value to decrease if circulation increases. 

In contrast, Ripple uses a deflationary approach. It’s achieved through the “burning” of coins. This is when coins are sent to a wallet with inaccessible keys, which means the coins can never be retrieved and spent. Coins are burned with each transaction, so the number of coins in circulation will eventually decrease. 

Regarding each currency’s maximum supply, Ripple has a maximum supply of 100 billion XRP that can be added into circulation. Stellar, however, has an unlimited supply of XLMs available for circulation.


Generally, cryptocurrency investors are wary of centralised control. After all, the very reason blockchains emerged was to allow for decentralised exchanges. 

When McCaleb left Ripple, the team initially froze all his XRP coins. While he has since been compensated, the action indicated that Ripple has more control than a decentralised cryptocurrency should have. For this reason, many investors will choose Stellar vs Ripple.

Stellar vs Ripple: Market Performance


XLM is a multi-billion-dollar coin, currently ranked #14 on CoinMarketCap. 

In March 2018, Stellar formed a highly successful partnership with IBM, which used Stellar’s technology to make bank transfers in the South Pacific more efficient and cheaper. It was one of the most significant partnerships for the crypto company. 

Another key collaboration was secured in 2020 when Ukraine decided to utilise Stellar’s blockchain technology to develop a central bank digital currency. 

Through such partnerships, the value of XLM is set to grow.


XRP is currently ranked #7. The fact that XRP holds more value than XLM is largely attributed to the fact that Ripple has been around for longer and has had more time to establish key partnerships. 

Over 100 banks have invested in Ripple’s distributed ledger technology, including some big names such as UBS and Santander. 

This technology doesn’t require banks to use XRP for their cross-border payments. But with that said, many banks in partnership with Ripple use XRP to solve liquidity problems associated with conventional cross-border payments, thereby increasing the currency’s value. 

Stellar vs Ripple 2020 Developments

The start of the Covid-19 pandemic resulted in sharp selloffs across the board, which caused a steep drop in the value of all cryptocurrencies, Stellar and Ripple included.   

Following an initial decline, both currencies started to climb as the dollar’s value fell in the wake of the pandemic. More investors began to turn to cryptocurrencies as an alternative to the unstable USD, increasing the value of both XLM and XRP. 

Another significant development in 2020 saw PayPal accepting BTC and other cryptocurrencies, XLM and XRP included, as payment options. This also functioned to increase the currencies’ value.  

In other news, Ripple is currently facing a lawsuit from the SEC. The SEC claims that XRP is an “unregistered securities offering,” which Ripple is currently in the process of challenging. The regulator claimed it should have been classed as a security, as with stocks.  

So, while Ripple secured some valuable partnerships in 2020, the currency’s future is uncertain considering the lawsuit. 

In Conclusion

So there you have it; while the currencies share founders and possess similar codes, there are key differences when considering Stellar vs Ripple technologies. 

Both currencies have seen similar market movements in the past year, although Ripple remains on top, albeit uncertainly for now, with the lawsuit pending.  

While the two companies have a shared history, only time will tell what their futures hold as they have differing philosophies and target markets. 

So, when considering Stellar vs Ripple, both currencies are good investments in their own right; it all depends on what you’re looking for!