Stellar vs Ripple: Which Is Better For Buy 2022

Stellar vs Ripple

Stellar and Ripple are two distributed ledger technologies (DLT) that are similar in many ways but have some distinct differences. Here’s a closer look at both these cryptos as well as a few pointers on whether you should invest in Stellar or Ripple.

Ripple and Stellar have gained a lot of traction among crypto investors since their inception.

As many crypto enthusiasts compare both networks due to many of their similarities; in fact, they both have different entities, principles, and philosophies.

However, both networks aim to improve the efficiency of completing transactions for financial institutions and payment providers.

That’s not all! Both these coins have a lot of differences and similarities. So, to get a precise knowledge of these networks, here are key differences and detailed comparisons between Stellar and Ripple.

So, let’s end this Stellar vs Ripple debate.

What Is Stellar (XLM)?

Stellar is a decentralized, open-source payment network that allows cost-effective, quick transfers and cross-border payments using blockchain technology.

On the other hand, Lumens coins are the native tokens of the network. The Stellar Lumens trades under the XLM ticker symbol on various crypto exchanges.

The coin has a maximum supply of 50 billion tokens, with over 22.5 billion in circulation right now.

You will be surprised to know that both Stellar and Ripple were created by the same person – Jed McCaleb.

However, Stellar is operated by McCaleb’s non-profit organization – Stellar development foundation.

Now that you know about Stellar let’s move forward to the short overview of Ripple.

Who Uses Stellar (XLM)?

Stellar is often used by people who want to transfer money quickly and cheaply. As an open network,  Stellar allows developers to build financial products on top of it, such as payment processing applications, mobile wallets and lending platforms.

Stellar’s functions are much similar to the SWIFT system. The usage of XLM is often directed toward an average individual rather than big banks, especially those in poorer countries.

What Is Ripple (XRP)?

Ripple is an international payments network developed by Jed McCaleb and Chris Larsen (Ripple Labs) in 2012.

The network uses the XRP token, which has 3rd largest market capitalization. The ripple network allows making fast transfers with minimum transaction fees.

Additionally, the network uses distributed ledger technology that doesn’t require third-party to make payments.

In addition to the global financial system, Ripple also provides high liquidity, which is great for financial institutions such as banks.

What Is Ripple (XRP) Used For? 

Apart from a cryptocurrency, Ripple is a payment network, which is widely used by individuals and businesses. For instance, banks and financial institutions used XRP to fastly settle international payments. As Ripple can settle payments in real-time, it hold potent to disrupt the entire banking system.

Additionally, Ripple was established to challenge the traditionally known SWIFT payment system, which enables the exchange of transactions between banks. While SWIFT usually takes 2-3 days to confirm a payment settlement, Ripple has the ability to settle transactions within seconds.

Stellar vs Ripple: What Are The Key Differences? 

To simplify the ongoing Stellar vs Ripple, we have come up with key differences between these two blockchain-based cryptocurrencies.

Ripple (XLM) Stellar (XLM)
Nature Ripple is a network that enables quick, low-cost international payments. Stellar as an open network, allows anyone to create financial products on top of it.
Use-case It is used mostly by banks and financial institutions to settle international payments It is used by people who want to send or receive money quickly and cheaply.
Native Coin XRP is Ripple’s native currency Stellar also has its own cryptocurrency, XLM
Uses Of Native Coins It is used to pay transaction fees and reward users who verify transactions. It is used to pay transaction fees and reward users who verify transactions.
Mining Ripple does not use mining like other cryptocurrencies Stellar also does not use mining
Consensus Mechanism XRP consensus system Federated Byzantine Agreement
Purpose Ripple is a private company Stellar is for “non-profit” purposes.

Stellar vs Ripple: How They Differ From Each Other?

As we came across the short introduction, you might have understood both these blockchain networks well. So, here are some key differences between Stellar vs Ripple.


Ripple was launched in 2012 by the founder Jed McCaleb and Chris Larsen. In 2014, Jed McCaleb created the Stellar network.

Initially, Stellar was created to address the limits of the previously developed network Ripple, but it subsequently evolved into a currency in its own right.

Target Market:

As both Stellar and Ripple allow for fast and cost-effective payment transfers, their targeted market is what makes them different.

And this is probably the most significant difference that simplifies the Stellar vs Ripple debate. The latter was developed keeping large financial institutions in mind.

The network makes it easy for people to make cross-border payments quickly. However, the network charges high transactional and exchange rate fees.

Conversely, Stellar Lumens focus on less-developed countries, mainly on the current financial systems.

Currently, millions of people are away from the reach of any banking system, so Stellar targets those people and allow them to use banking services.

Consensus Mechanism:

It is a technology via which blockchain validates transactions without any need for a third party.

For instance, Stellar uses the Stellar Consensus Protocol (SCP).

Meanwhile, the Ripple network uses the Ripple Protocol Consensus Algorithm (RPCA).

Token Distribution:

Ripple’s native and utility token is XRP. However, there has recently been a lot of buzz around the security of XRP tokens.

On the other hand, there are 100 billion XRP in circulation, all of which have been pre-mined. Ripple does not require any stakes or miners. The network controls almost 60 billion of these total 100 billion XRP coins.

Similarly, Stellar has pre-mined 100 billion Lumen tokens (XLM), with the Stellar Development Foundation overseeing the distribution of the coins.

The Stellar Foundation owns 5% of the tokens. In addition, stellar has a feature called Spam Fees to combat spamming. The platform charges a nominal transaction fee.

Payment Partners:

Some of the few payment partners of the Ripple network include American Express, SBI Group, Western Union, MoneyGram (no longer), Accenture, and GMT.

For the IBM World Wire initiative, Stellar Lumens has partnered with IBM. The IBM World Wire is a global network that allows financial institutions to instantly process and settle cross-border payments.

Inflation and Deflation:

Due to its rising scarcity, XRP is a deflationary currency, which means that its buying power will likely increase over time.

The reasons for its scarcity are obvious. For instance, the transaction fees on XRP are burnt or permanently withdrawn from circulation.

Conversely, Stellar has a set yearly inflation rate of 1%. As global inflation develops, inflation guarantees that those who can access XLM continue to get a reasonable value for the money.

Organizational Structure:

Ripple is a for-profit organization, whereas Stellar is a non-profit organization. This is because the creator wanted to do something to help the unbanked and underbanked countries.


Because Ripple is a closed-source protocol, no one else has access to it. On the other hand, stellar is open source, implying that anybody may use it.

Because it is open-source, anybody may modify it to meet their needs and use it accordingly.

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Side-by-Side Comparison of Stellar and Ripple:

As we have gone through the key differences between the stellar and Ripple, here’s a side-by-side comparison between these two networks.

This will help you understand the Stellar vs Ripple debate even better. So, let’s start!

Features Stellar Ripple
Founded Founded by the Stellar Development Foundation in 2014. Founded by the XRP Labs in 2012.
Accessibility Large financial institutions, Banks, etc. General People
Protocol Open-Source Close-Source
Control Decentralized Centralized
Native Token Lumens (XLM) Ripple (XRP)
Maximum Token Supply 50 Billion 100 Billion
Mining Not Allowed Not Allowed
Consensus Algorithm Stellar uses the Stellar Consensus Protocol (SCP), Federated Byzantine Agreement Ripple Protocol Consensus Algorithm (RPCA)
Value Influencer Inflation Deflation
Organization Type Non-profit Organization Profit Making Organization

Stellar vs Ripple: Similarities

Apart from some of the major differences, there are a lot of similarities between Stellar and Ripple.

Stellar (XLM) Ripple (XRP)
Limited Token Supply The maximum supply of XLM is 50 billion. The maximum quantity of XRP is capped at 100 billion coins,
Fees Lower Transaction Fees Low Transaction Fees similar to XLM
Transaction Time Fast Fast
Mining Not Allowed Allowed

Stellar vs Ripple: Which One To Choose?

Stellar and Ripple both are great blockchain-based projects and payment networks for transferring money internationally. However, both come with their own set of advantages and limitations. Here’s quick guidance on which cryptocurrency you should choose:

Choose Ripple If:

  • You are looking to settle foreign payments swiftly and affordably.
  • You’re searching for a blockchain-based in the US
  • Finding a well-known Cryptocurrency

Choose Steller If:

  • You wish to transfer or receive money swiftly and affordably.
  • Looking Low Transaction Fees
  • You’re seeking a more decentralized blockchain.

Ultimately, the decision to choose the best depends on you and your requirements.

The Final Verdict:

As we have come to an end of this Stellar vs Ripple debate, hope you have understood the topic precisely. Here’s a quick summary of the topic:

  • Ripple and Stellar aim to make international payments easier to complete, especially those involving numerous currencies.
  • While Stellar focuses on the unbanked and underdeveloped countries, Ripple targets banks when expanding its technology.
  • Both have extremely high market values and popularity rankings, and comparable prices.

Therefore, it seems that Ripple and Stellar are quite popular these days. As a result, the crypto community appears to embrace both networks despite their similarities.

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Will Stellar Outperform Ripple?

The value of Stellar (XLM) has been continuously rising for the last few months.

Moreover, there are not any signs of its slowing down. So, we may expect that Stellar will outperform Ripple in the coming years.

Ripple vs Stellar: What Should I Buy?

Stellar’s token XLM is more accessible for individuals, while Ripple is more focused on large financial institutions.

Who Is XRP Biggest Competitor?

Stellar Lumens is considered the biggest competitor for XRP.

Why Is XRP So Low?

The main reason behind the low value of XRP remains the lawsuit against it filed by the US Security and Exchange Commission (SEC).

How Much Will XRP Be in 2030?

According to the price prediction, XRP is expected to be worth $5 by 2030.